Financial Decision-Making and Expansion Planning Quiz

10 Questions

What is the profit earned by the company after meeting its interest liability on debentures?

Rs.3,00,000

What is the tax rate for the company?

50%

What is the number of equity shares of Rs.10 each?

80,000

What is the retained earnings amount?

Rs.12,00,000

What is the amount required for the proposed expansion scheme?

Rs.4,00,000

Match the following financial terms with their definitions:

Earnings Per Share (EPS) = The portion of a company's profit allocated to each outstanding share of common stock Retained Earnings = The portion of net income that is retained by a corporation rather than distributed to its owners as dividends Debt = An amount of money borrowed by one party from another Equity Shares = A type of share in a company that represents ownership and is the main source of equity financing

Match the following financial calculations with their formulas:

Profit = Profit = Total Revenue - Total Expenses Earnings Per Share (EPS) = EPS = (Net Income - Preferred Dividends) / Average Outstanding Shares Interest = Interest = Principal x Rate x Time Tax Liability = Tax Liability = Taxable Income x Tax Rate

Match the following financial ratios with their definitions:

Return on Investment (ROI) = ROI measures the gain or loss generated on an investment relative to the amount of money invested Debt-to-Equity Ratio = The debt-to-equity ratio is a measure of a company's financial leverage Net Profit Margin = Net profit margin is the percentage of revenue remaining after all operating expenses, interest, taxes and preferred stock dividends have been deducted from a company's total revenue Current Ratio = The current ratio is a liquidity ratio that measures a company's ability to pay short-term obligations

Match the following financial statements with their descriptions:

Income Statement = An income statement is a financial statement that reports a company's financial performance over a specific accounting period Balance Sheet = A balance sheet is a financial statement that reports a company's assets, liabilities and shareholders' equity at a specific point in time Cash Flow Statement = A cash flow statement is a financial statement that shows how changes in balance sheet accounts and income affect cash and cash equivalents Statement of Retained Earnings = A statement of retained earnings is a financial statement that reconciles the beginning and ending retained earnings for the period

Match the following financial terms with their explanations:

Equity Financing = Equity financing is the method of raising capital by selling company stock to investors Debt Financing = Debt financing occurs when a firm raises money for working capital or capital expenditures by selling bonds, bills, or notes to individuals and/or institutional investors Interest Coverage Ratio = The interest coverage ratio is a measure of a company's ability to meet its interest payments Tax Rate = The tax rate is the percentage at which an individual or corporation is taxed

This quiz tests your knowledge on financial decision-making and expansion planning for a company. You will be asked to calculate profit, interest liability, tax rate, number of equity shares, and retained earnings. Get ready to apply your financial analysis skills!