Procedimiento de trazo de saco línea clásico

1. Which one of the following is not a function of budgeting?

(a) Controlling (b) Motivating (c) Planning (d) Decision-making 2. Which one is not a source of income?

(a) Income from salaries

(b) Income from illegal activities (c) Income from house property (d) Income from capital gains 3. The budgetary deficit in India is

(a) Increasing (b) Decreasing (c) Constant (d) Stationary

4. When public revenue exceeds public expenditure, it is said to be a

(a) Deficit budget (b) Surplus budget (c) Balanced budget (d) Planned budget 5. A desire for something is known as

(a) Want (b) Demand

(c) Scarcity (d) Choice

6. The amount of money received during a period of time in exchange for services is called

(a) Payment (b) Income

(c) Investment (d) Returns

7. An organisation or economic system where goods and services are exchanged for one another for money is called

(a) Company (b) Equity

(c) Business (d) Trading

8. Money that is spent for need and wants is

(a) Saving (b) Investment

(c) Expenditure (d) Satisfaction 9. Which is not a pillar of investment?

(a) Safety (b) Consumption

(c) Liquidity (d) Growth

10. Mr Kapoor earns a monthly income of `20,000. He spends money on his family members.

Following are the areas of expenditure of monthly budget in rupees.

Medical 2500

Electricity bill 1000

Phone bill 1800

Grocery 2500

School fees of children 5000

Miscellaneous 2500

Family’s monthly budget shows

(a) Surplus (b) Deficit

(c) Balance (d) Borrowings

11. Which of the following is not considered saving?

(a) Putting change in piggy bank (b) Putting money in bank

(c) Consumption plan (d) Pension plan

12. Putting money into an asset with the expectation of capital appreciation is called

(a) Investment (b) Saving

(c) Accumulation (d) Interest earnings

13. A benefit or value of something that must be given up to acquire something else is

(a) Total cost (b) Opportunity cost (c) Fixed cost (d) Prime cost

14. Ram goes to a college to study. If he would have worked in the office at the same time, then he would have earned some money. In this case, his opportunity cost would be

(a) Going to the college

(b) Going to the office to earn money (c) Sitting at home doing nothing (d) Playing in the field

15. Which of the following activities is not included in cash flow statement?

(a) Operating activities (b) Consuming activities (c) Investing activities (d) Financing activities 16. A cash flow statement reflects a firm’s

(a) Liquidity (b) Safety

(c) Durability (d) Accountability 17. Statement of cash flows is useful in determining

(a) The ability to pay bills

(b) Short-term viability of a company (c) Financial activities

(d) All of the above

18. Mr and Mrs Singh have following family demands to meet.

State the want which is not urgent.

(a) Payment of school fees (b) Purchase of medicine

(c) Gift for the marriage of common friend (d) Electricity bill payment

19. Satisfaction gained by more impulsive behaviour is known as(a) Instant gratification

(b) Delayed gratification (c) Impulsive gratification (d) Behaviour gratification

20. The ability to resist temptation for an immediate reward is called

(a) Instant gratification (b) Delayed gratification (c) Temporary gratification (d) Immediate gratification 21. Budgetary control requires expenditure of time, money and

efforts. We need to draw an effective budget in order to : (a) Optimise savings

(b) Ensure that we do not spend beyond our means

(c) Effectively allot funds to various areas of expenditure in advance

(d) All of the above

22. Shamit has `2000 in his pocket. He goes to the market and after looking at a beautiful dress, she is tempted to buy it. But, suddenly she realised that next month she has to purchase a textbook on ‘Finance’ and she has to pay the school fees of `1500. Therefore, she did not buy the dress and saved the money for future use. Can you tell what type of gratification does it show?

(a) Instant gratification (b) Delayed gratification (c) Regular gratification (d) Shopping gratification 23. Deepak has `500 a week to spend on food and clothing.

The price of food is `10 and the price of clothing is

`25. Which of the following pairs of food and clothing are in Deepak’s choice set?

(a) 20 units of clothing and 50 units of food (b) 0 units of clothing and 500 units of food (c) 50 units of clothing and 50 units of food (d) 10 units of clothing and 25 units of food

24. An increase in the value of a capital asset (Real estate or investment) that gives it a higher worth than the purchase price is called

(a) Financial gain (b) Capital gain (c) Property gain (d) Business gain

25. An income received on regular basis with little effort required to maintain it is known as

(a) Active income (b) Professional income (c) Business income (d) Passive income

26. It is important to analyse the cash flow statement, to draw an optimum savings plan and then draw a judicious budget in order to achieve

(a) Budget goal (b) Financial planning (c) SMART goal (d) Business goal

27. Which is not the key point of financial goal setting?

(a) Set simple, measurable goals (b) Set realistic time line for goal

(c) Commit to achieving goals (d) Planning financial goals casually

28. The term budgetary period refers to (a) The subdivisions of the main budget

(b) The period for which the budget is prepared (c) The period for which the budget is finalised

(d) A specific year for which budget has been prepared 29. A plan expressed in financial terms may also be known as

(a) Budget (b) Final account (c) Forecast (d) Balanced score card 30. Net cash flow can be calculated by

(a) Cash inflows less cash outflows

(b) Opening balance of cash plus cash inflows (c) Cash inflows plus cash outflows

(d) Opening balance of cash plus cash inflows

31. An increase in the value of capital asset that gives it a higher worth than the purchase price is called

(a) Investment (b) Capital gain

(c) Saving

(d) Property accumulation

32. Income and expenditure account is prepared with the object of finding out

(a) Surplus of current incomes over current expenses (b) Deficit of current incomes over current expenses

(c) Both surplus and deficit of current incomes over current expenses

(d) Income of current year

33. An institution organised and operated to provide goods and services to society under the incentive of private gain is known as

(a) Business (b) Investment (c) Operational working (d) None of the above 34. Which is not the characteristic of business?

(a) Economic activity (b) Regularity of dealing (c) Narrow scope (d) Creation of utility

35. Which is not the objective of business?

(a) Profit motive

(b) Limited utilisation of resources (c) Satisfaction of human needs (d) Innovation

36. Different factors which influence the choice of a suitable form of organisation includes

(a) Ease of formation (b) Capital requirement

(c) Direction and control (d) All of the above

37. In spite of best effort, sometimes financial planning fails to achieve the desired results because

(a) It involves huge cost

(b) It may result in delay in decisions (c) Of natural calamities

(d) All of the above

38. Observe the picture given below. State what does it show?

(a) Deficit budget (b) Surplus budget

(c) Balanced budget (d) Government expenses

39. Income is the money received, especially on a regular basis, for work or through investments. There are different sources of income. Observe the picture given below and state the source of income.

(a) Income from salaries (b) Income from business

(c) Income from house property (d) Income from profits

40. Which is not the example of active Income?

(a) Wages and salaries (b) Commissions

(c) Dividends and Interest (d) Income from business

Answers

1. (d) 2. (b) 3. (a) 4. (b) 5. (a) 6. (b) 7. (c) 8. (c) 9. (b) 10. (a) 11. (c) 12. (a) 13. (b)

14. (b) Explanation : The opportunity cost of any good is the next best alternative good or activity that is sacrificed. It is the cost of forgone alternative, therefore, it is also known as alternative cost.

15. (b) 16. (a) 17. (d) 18. (c) 19. (a) 20. (b) 21. (d) 22. (b)

23. (d) Explanation: Here he will get maximum satisfaction by spending `500

Clothing = Price × Quantity = 25 × 10 = `250 Food = Price × Quantity

= 10 × 25 = `250 (250 + 250 = 500) 24. (b) 25. (d)

26. (c) Explanation : Dreams should be translated to SMART goals if they are to be realised.

27. (d) Explanation : Setting financial goal is a smart choice and can be very rewarding. Financial goals or financial target is an objective which is expressed in or based upon money.

28. (b) Explanation : The period for which the budget is prepared is known as budgetary period. Although, in most cases, it will be a year, whereas some companies may have either shorter or a longer period.

29. (a) 30. (a) 31. (b)

32. (c) Explanation : Income and Expenditure Account is a summary of all incomes and expenses relating to the current accounting year. It is prepared like the Trading and Profit and Loss Account.

33. (a) 34. (c)

35. (b) Explanation : Business objective is optimum utilisation of resources i.e., the best use of men, material and machinery.

36. (d) 37. (d)

38. (c) Explanation : Balanced budget is the budget in which revenues (income) is equal to the expenditure.

39. (c) Explanation : The house property consists of any building or land owned by an individual. The annual value of the property is subject to tax.

40. (c) Explanation : Passive incomes are the earnings an individual derives from a rental property, limited partnership, or other enterprises in which he or she is not actively involved.

UNDERSTANDING INSURANCE AND