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Test: Business Finance and Arithmetic - 3 - Commerce MCQ


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10 Questions MCQ Test Entrepreneurship Class 11 - Test: Business Finance and Arithmetic - 3

Test: Business Finance and Arithmetic - 3 for Commerce 2024 is part of Entrepreneurship Class 11 preparation. The Test: Business Finance and Arithmetic - 3 questions and answers have been prepared according to the Commerce exam syllabus.The Test: Business Finance and Arithmetic - 3 MCQs are made for Commerce 2024 Exam. Find important definitions, questions, notes, meanings, examples, exercises, MCQs and online tests for Test: Business Finance and Arithmetic - 3 below.
Solutions of Test: Business Finance and Arithmetic - 3 questions in English are available as part of our Entrepreneurship Class 11 for Commerce & Test: Business Finance and Arithmetic - 3 solutions in Hindi for Entrepreneurship Class 11 course. Download more important topics, notes, lectures and mock test series for Commerce Exam by signing up for free. Attempt Test: Business Finance and Arithmetic - 3 | 10 questions in 10 minutes | Mock test for Commerce preparation | Free important questions MCQ to study Entrepreneurship Class 11 for Commerce Exam | Download free PDF with solutions
Test: Business Finance and Arithmetic - 3 - Question 1

What is the definition of "Cash Flow"?

Detailed Solution for Test: Business Finance and Arithmetic - 3 - Question 1
Cash flow refers to the movement of money in and out of a business during a specific period. It is a crucial concept in financial management, as it helps assess a company's liquidity and ability to meet its financial obligations. Understanding cash flow is essential for effective financial planning and decision-making.
Test: Business Finance and Arithmetic - 3 - Question 2

What is the definition of "Gross Profit"?

Detailed Solution for Test: Business Finance and Arithmetic - 3 - Question 2
Gross profit is the profit earned from the sale of goods after deducting the cost of goods sold (COGS). It represents the basic profitability of a company's core operations and is an important metric for assessing a company's financial performance.
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Test: Business Finance and Arithmetic - 3 - Question 3

What does "Break-even point" represent in business?

Detailed Solution for Test: Business Finance and Arithmetic - 3 - Question 3
The break-even point is the point at which a business neither makes a profit nor incurs a loss. It is the level of sales at which total revenue equals total costs, including fixed and variable costs. Beyond the break-even point, a business starts making a profit.
Test: Business Finance and Arithmetic - 3 - Question 4
What is the primary purpose of a "Cash Register" in accounting?
Detailed Solution for Test: Business Finance and Arithmetic - 3 - Question 4
A Cash Register in accounting is primarily used to record all cash and bank transactions of a business. It helps maintain an accurate record of all monetary inflows and outflows.
Test: Business Finance and Arithmetic - 3 - Question 5
What is the formula for calculating "Gross Profit per Unit"?
Detailed Solution for Test: Business Finance and Arithmetic - 3 - Question 5
The formula for calculating Gross Profit per Unit is Gross Profit per Unit = Total Sales - Total Cost of Goods Sold. It represents the profit earned from the sale of one unit of a particular product after deducting the cost of producing that unit.
Test: Business Finance and Arithmetic - 3 - Question 6
What are "Credit Sales" in a business context?
Detailed Solution for Test: Business Finance and Arithmetic - 3 - Question 6
Credit Sales in a business context refer to the practice of selling products on credit, meaning that the buyer does not pay for the products immediately. Instead, they are provided with a period to settle the payment at a later date.
Test: Business Finance and Arithmetic - 3 - Question 7
What are "Variable Costs" in business?
Detailed Solution for Test: Business Finance and Arithmetic - 3 - Question 7
Variable Costs in business are costs that vary as the total output (number of items or services produced) varies. These costs increase or decrease in direct proportion to the level of production or sales.
Test: Business Finance and Arithmetic - 3 - Question 8
What is the purpose of a "Cash Flow Projection"?
Detailed Solution for Test: Business Finance and Arithmetic - 3 - Question 8
A Cash Flow Projection is used to assess a business's liquidity and expected cash movements. It helps in forecasting how cash is expected to flow in and out of the business, allowing for better financial planning and decision-making.
Test: Business Finance and Arithmetic - 3 - Question 9
What is the primary difference between direct taxes and indirect taxes?
Detailed Solution for Test: Business Finance and Arithmetic - 3 - Question 9
Direct taxes are taxes that individuals pay directly to the government, such as income tax. In contrast, indirect taxes are paid indirectly through the purchase of goods and services, like sales tax or value-added tax (VAT).
Test: Business Finance and Arithmetic - 3 - Question 10
What is the definition of "Depreciation"?
Detailed Solution for Test: Business Finance and Arithmetic - 3 - Question 10
Depreciation is the reduction in the balance of a fixed asset (except land) due to wear and tear, obsolescence, or other factors. It reflects the decrease in the asset's value over time and is recorded as an expense on the income statement.
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