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Created on April 13, 2026 By

CA Sonal Saboo

CMA Inter

Inter FMDA PN-11 Quiz 3

This quiz is based on the CMA Financial Management and Business Data Analytics paper.
Each question is multiple-choice with 4 options, and only 1 option is correct.
Attempt the quiz to test your understanding of CMA FMDA concepts.

1 / 25

Category: Financial Management and Business Data Analytics PN-11

1. Which of the following cost of capital require tax adjustment?

a. Cost of Equity Shares

b. Cost of Preference Shares

c. Cost of Debentures

d. Cost of Retained Earnings

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Category: Financial Management and Business Data Analytics PN-11

2. Weighted Average Cost of Capital (WACC) is generally denoted by:

a. ka

b. kw

c. k0

d. kc

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Category: Financial Management and Business Data Analytics PN-11

3. Cost of capital for bonds and debentures is calculated on:

a. Before Tax basis

b. After Tax basis

c. Risk-free Rate of Interest basis

d. Compound interest

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Category: Financial Management and Business Data Analytics PN-11

4. Cost of capital for Government securities is also known as:

a. Risk-free Rate of Interest

b. Maximum Rate of Return

c. Rate of Interest on Fixed Deposits

d. None of the above

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Category: Financial Management and Business Data Analytics PN-11

5. Which of the following has the highest cost of capital?

a. Equity shares

b. Loans

c. Bonds

d. Preference shares

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Category: Financial Management and Business Data Analytics PN-11

6. Which of the following sources of funds has an implicit cost of capital?

a. Equity Share Capital

b. Preference Share Capital

c. Debentures

d. Retained earnings

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Category: Financial Management and Business Data Analytics PN-11

7. Cost of capital refers to:

a. Flotation Cost

b. Dividend

c. Required Rate of Return

d. None of the above

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Category: Financial Management and Business Data Analytics PN-11

8. Statement of cash flows are included in:

a. Ind AS - 3

b. Ind AS - 6

c. Ind AS - 7

d. Ind AS - 113

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Category: Financial Management and Business Data Analytics PN-11

9. In Inventory Turnover calculation, what is taken in the numerator?

a. Sales

b. Cost of Goods Sold

c. Opening Stock

d. Closing Stock

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Category: Financial Management and Business Data Analytics PN-11

10. Ratio Analysis can be used to study liquidity, turnover, profitability, etc. of a firm. What does Debt-Equity Ratio help to study?

a. Solvency

b. Liquidity

c. Profitability

d. Turnover

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Category: Financial Management and Business Data Analytics PN-11

11. XYZ Ltd. has a Debt Equity Ratio of 1.5 as compared to 1.3 Industry average. It means that the firm has:

a. Higher Liquidity

b. Higher Financial Risk

c. Higher Profitability

d. Higher Capital Employed

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Category: Financial Management and Business Data Analytics PN-11

12. Return on Assets and Return on Investment Ratios belong to:

a. Liquidity Ratios

b. Profitability Ratios

c. Solvency Ratios

d. Turnover

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Category: Financial Management and Business Data Analytics PN-11

13. Which of the following helps analysing return to equity Shareholders?

a. Return on Assets

b. Earnings Per Share

c. Net Profit Ratio

d. Return on Investment

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Category: Financial Management and Business Data Analytics PN-11

14. Debt to Total Assets of a firm is 2. The Debt to Equity would be:

a. 0.80

b. 0.25

c. 1.00

d. 0.75

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Category: Financial Management and Business Data Analytics PN-11

15. Which of the following statements is correct?

a. A Higher Receivable Turnover is not desirable

b. Interest Coverage Ratio depends upon Tax Rate

c. Increase in Net Profit Ratio means increase in Sales

d. Lower Debt-Equity Ratio means lower Financial Risk

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Category: Financial Management and Business Data Analytics PN-11

16. Gross Profit Ratio for a firm remains same but the Net Profit Ratio is decreasing. The reason for such behavior could be:

a. Increase in Costs of Goods Sold

b. If Increase in Expense

c. Increase in Dividend

d. Decrease in Sales

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Category: Financial Management and Business Data Analytics PN-11

17. Which of the following is a measure of Debt Service capacity of a firm?

a. Current Ratio

b. Acid Test Ratio

c. Interest Coverage Ratio

d. Debtors Turnover

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Category: Financial Management and Business Data Analytics PN-11

18. Suppliers and Creditors of a firm are interested in:

a. Profitability Position

b. Liquidity Position

c. Market Share Position

d. Debt Position

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Category: Financial Management and Business Data Analytics PN-11

19. XYZ Ltd. has earned 8% Return on Total Assests of Rs. 50,00,000 and has a Net Profit Ratio of 5%. Find out the Sales of the firm.

a. Rs. 4,00,000

b. Rs. 2,50,000

c. Rs. 80,00,000

d. Rs. 83,33,333

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Category: Financial Management and Business Data Analytics PN-11

20. A firm has Capital of Rs. 10,00,000; Sales of Rs. 5,00,000; Gross Profit of Rs. 2,00,000 and Expenses of Rs. 1,00,000. What is the Net Profit Ratio?

a. 20%

b. 50%

c. 10%

d. 40%

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Category: Financial Management and Business Data Analytics PN-11

21. A Current Ratio of less than one means:

a. Current Liabilities < Current Assets

b. Fixed Assets > Current Assets

c. Current Assets < Current Liabilities

d. Share Capital > Current Assets

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Category: Financial Management and Business Data Analytics PN-11

22. Trend Analysis helps comparing performance of a firm -

a. With other firms

b. Over a period of firm

c. With other industries

d. With other companies

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Category: Financial Management and Business Data Analytics PN-11

23. Ratio of Net Income to Number of Equity Shares known as:

a. Price Earnings Ratio

b. Net Profit Ratio

c. Earnings per Share

d. Dividend per Share

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Category: Financial Management and Business Data Analytics PN-11

24. Debt to Total Assets Ratio can be improved by:

a. Borrowing More

b. Issue of Debentures

c. Issue of Equity Shares

d. Redemption of Debt

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Category: Financial Management and Business Data Analytics PN-11

25. Which of the following does not help to increase Current Ratio?

a. Issue of Debentures to buy Stock

b. Issue of Debentures to pay Creditors

c. Sale of Investment to pay Creditors

d. Avail Bank Overdraft to buy Machine

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Inter PN-11 FMDA Quiz 3

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