Financial Management - Study Mode
[#1176] In order to calculate EPS, Profit after Tax and Preference Dividend is divided by:
Correct Answer
(B) Number of Equity Shares
[#1177] Which of the following is not incorporated in Capital Budgeting?
Correct Answer
(D) Rate of Cash Discount
[#1178] Bond which is issued in market and few days are passed of its issuance is classified as
Correct Answer
(B) outstanding bond
Explanation
Solution: Bond which is issued in market and few days are passed of its issuance is classified as outstanding bond. Outstanding Bonds means the aggregate principal amount of the total number of Bonds not redeemed or otherwise discharged.
[#1179] Real risk-free rate is applicable when it is expected that there will be
Correct Answer
(D) none of above
Explanation
Solution: The risk-free rate of return is the theoretical rate of return of an investment with zero risk. The risk-free rate represents the interest an investor would expect from an absolutely risk-free investment over a specified period of time.
[#1180] Bonds that do not pay original coupon payment but payment is made from additional bonds are classified as
Correct Answer
(A) payment in-kind bonds
Explanation
Solution: Bonds that do not pay original coupon payment but payment is made from additional bonds are classified as payment in-kind bonds. A payment-in-kind (PIK) bond is a type of bond that pays interest in additional bonds rather than in cash.