All Free Management Sciences MCQs with Answers

• A. Cash flow of financing activities
• B. Cash flow per share
• C. Cash flow of investment
• D. Cash flow of operationsTry Prep Courses

Explanation: Adding net income, depreciation, and amortization gives an accounting measure of cash generated, and dividing it by common shares…

• A. Fixed payment investment
• B. Lump sum amount
• C. Fixed interval investment
• D. Annuity

Explanation: Equal payments of $100 made at regular intervals for a limited number of periods form an ordinary annuity when paid at each year-end.

• A. Rises
• B. Declines
• C. Equals
• D. None of aboveCompare Exchange Rates

Explanation: Bond prices and market interest rates move in opposite directions because the bond's fixed payments become less attractive when new rates…

• A. Inventories
• B. Short-term investments
• C. Cash equivalents
• D. Long-term investments

Explanation: Cash equivalents are short-term, highly liquid securities that can quickly be converted into a known cash amount with minimal risk of…

• A. Annual percentage rate
• B. Annual rate of return
• C. Loan rate of return
• D. Local rate of returnCompare Investment Apps

Explanation: The nominal borrowing rate quoted to consumers, without treating intra-year compounding as a separate effective rate, is commonly stated…

• A. Amortized loan
• B. Depreciated loan
• C. Appreciated loan
• D. Repaid payments

Explanation: An amortized loan is repaid through regular installments that include both interest and a gradual reduction of principal.

• A. Depreciation
• B. Amortization
• C. Stock amortization
• D. Perishable assets

Explanation: The cost of a finite-life intangible asset is allocated over its useful life through amortization.

• A. Tangible asset
• B. Non-tangible assets
• C. Financial asset
• D. Financial liability

Explanation: Land, buildings, and factory equipment have physical substance, so they are tangible assets.

• A. Free cash flow
• B. Retained cash flow
• C. Net cash flow
• D. Financing cash flow

Explanation: Under the indirect cash-flow method, net income is adjusted by adding non-cash charges and subtracting non-cash revenues to arrive at net…

• A. Investment return rate
• B. Internal rate of return
• C. International rate of return
• D. Intrinsic rate of return

Explanation: The internal rate of return is the discount rate at which an investment's present value of inflows equals its initial cost, giving an…

• A. Five years report
• B. Annual report
• C. Stock report
• D. Exchange report

Explanation: An annual report combines financial statements, management discussion, and other performance information that investors use to assess…

• A. Appreciation
• B. Depreciation
• C. Appreciated assets
• D. Appreciated liabilities

Explanation: Depreciation allocates the cost of a tangible asset over its useful life, rather than treating the entire purchase cost as one period's…

• A. Preferred equity
• B. Due equity
• C. Common perpetuity
• D. Common equity

Explanation: Common equity consists primarily of common stockholders' contributed capital and retained earnings, which are profits kept in the…

• A. Compounding
• B. Discounting
• C. Money value
• D. Stock value

Explanation: Compounding moves a present amount forward by applying interest over successive periods, producing its future value.

• A. Earning per share
• B. Dividends per share
• C. Book value of share
• D. Market value of shares

Explanation: Earnings per share is calculated by dividing net income available to common shareholders by the number of shares outstanding.

• A. Preferred stockholders
• B. Common stockholders
• C. Hybrid stockholders
• D. Debt holders

Explanation: Preferred stockholders normally receive a fixed dividend, so they do not directly share in additional earnings growth.

• A. Current liabilities
• B. Income expenses
• C. Non-cash revenues
• D. Non-cash charges

Explanation: Depreciation and amortization reduce reported profit but do not involve a current cash payment.

• A. Depreciation and amortization
• B. Net sales
• C. Net profit
• D. Net income

Explanation: Depreciation and amortization allocate the cost of long-term assets over the periods in which they are used.

• A. Not shown on timeline
• B. Shown on timeline
• C. Multiplied on timeline
• D. Divided on timeline

Explanation: A nominal annual rate must be converted into the periodic rate used for each timeline period, so it is not itself shown as a cash flow on…

• A. Preferred stock account
• B. Common stock account
• C. Due stock account
• D. Preceded stock account

Explanation: When a company issues common shares, the proceeds are credited to the common stock account, with any amount above par value usually…