Direction: In the questions given below are two statements labelled as Assertion (A) and Reason (R). In the context of the two statements, which one of the following is correct? Assertion (A): Financial management process begins with the financial planning and decisions. Reason (R): Financial management process does not need feedback system.

Both A and R are true and R is the correct explanation of A

Both A and R are true, but R is not the correct explanation of A

Direction: In the questions given below are two statements labelled as Assertion (A) and Reason (R). In the context of the two statements, which one of the following is correct? Assertion (A): Debt and equity differ significantly in their cost and riskiness for the firm. Reason (R): Debt is cheaper but is more risky for a business because the payment of interest and the return of principal is obligatory for the business.

Both A and R are true and R is the correct explanation of A

Both A and R are true, but R is not the correct explanation of A

Direction: In the questions given below are two statements labelled as Assertion (A) and Reason (R). In the context of the two statements, which one of the following is correct? Assertion (A): The value of the concern is determined only by profitability. Reason (R): Financial decisions which increase the profitability will decrease the value of the firm.

Both A and R are true and R is the correct explanation of A

Both A and R are true, but R is not the correct explanation of A

Direction: In the questions given below are two statements labelled as Assertion (A) and Reason (R). In the context of the two statements, which one of the following is correct? Assertion (A): Financial planning includes determining the objectives, policies, procedures and programmes to deal with financial activities. Reason (R): Financial planning facilitates in developing a sound capital structure which gives maximum returns to shareholders.

Both A and R are true and R is the correct explanation of A

Both A and R are true, but R is not the correct explanation of A

Direction: In the questions given below are two statements labelled as Assertion (A) and Reason (R). In the context of the two statements, which one of the following is correct? Assertion (A): Financial management provide the base for success of promotion. Reason (R): Sound financial plan is very necessary for the success of business enterprise.

Both A and R are true and R is the correct explanation of A

Both A and R are true, but R is not the correct explanation of A

Direction: In the questions given below are two statements labelled as Assertion (A) and Reason (R). In the context of the two statements, which one of the following is correct? Assertion (A): Financial planning includes both short-term as well as long-term planning. Reason (R): Short-term planning focuses on capital expenditure programmes.

Both A and R are true and R is the correct explanation of A

Both A and R are true, but R is not the correct explanation of A

Direction: In the questions given below are two statements labelled as Assertion (A) and Reason (R). In the context of the two statements, which one of the following is correct? Assertion (A): The need for financial planning in a concern can be over-emphasised. Reason (R): Financial planning helps to provide ahead for any more funds, if required.

Both A and R are true and R is the correct explanation of A

Both A and R are true, but R is not the correct explanation of A

Direction: In the questions given below are two statements labelled as Assertion (A) and Reason (R). In the context of the two statements, which one of the following is correct? Assertion (A): Financial planning ensures that the firm does not raise resources unnecessarily. Reason (R): Excess funding is almost as bad as inadequate funding.

Both A and R are true, but R is not the correct explanation of A

Both A and R are true and R is the correct explanation of A

Direction: In the questions given below are two statements labelled as Assertion (A) and Reason (R). In the context of the two statements, which one of the following is correct? Assertion (A): A business firm is usually a profit earning concern. Reason (R): Its earnings depend upon the efficient utilisation of funds.

Both A and R are true and R is the correct explanation of A

Both A and R are true, but R is not the correct explanation of A

Direction: In the questions given below are two statements labelled as Assertion (A) and Reason (R). In the context of the two statements, which one of the following is correct? Assertion (A): Financial planning tries to link the present with the future. Reason (R): Financial planning is essentially the preparation of a financial blueprint of an organisation’s future operations.

Both A and R are true and R is the correct explanation of A

Both A and R are true, but R is not the correct explanation of A

Direction: In the questions given below are two statements labelled as Assertion (A) and Reason (R). In the context of the two statements, which one of the following is correct? Assertion (A): Effective and efficient management of finance enables the firm to prosper and grow. Reason (R): Without adequate finance, business can survive only for a short time.

Both A and R are true and R is the correct explanation of A

Both A and R are true, but R is not the correct explanation of A

Direction: In the questions given below are two statements labelled as Assertion (A) and Reason (R). In the context of the two statements, which one of the following is correct? Assertion (A): Higher the flotation cost, less attractive the source. Reason (R): The choice between the payment of dividend and retaining the earnings is, to some extent, affected by the difference in the tax treatment of dividends and capital gains.

Both A and R are true and R is the correct explanation of A

Both A and R are true, but R is not the correct explanation of A

Direction: In the questions given below are two statements labelled as Assertion (A) and Reason (R). In the context of the two statements, which one of the following is correct? Assertion (A): Financial management is an imaginative function. Reason (R: Financial management, is one of the functional areas of management.

Both A and R are true and R is the correct explanation of A

Both A and R are true, but R is not the correct explanation of A

Direction: In the questions given below are two statements labelled as Assertion (A) and Reason (R). In the context of the two statements, which one of the following is correct? Assertion (A): Finance fulfills only the beginning requirement of the business. Reason (R): Finance is needed only to promote business.

Both A and R are true and R is the correct explanation of A

Both A and R are true, but R is not the correct explanation of A

Direction: In the questions given below are two statements labelled as Assertion (A) and Reason (R). In the context of the two statements, which one of the following is correct? Assertion (A): Finance is the life blood of business. Reason (R): Finance very essential for the smooth running of the business.

Both A and R are true and R is the correct explanation of A

Both A and R are true, but R is not the correct explanation of A

Financial Management- Assertion and Reason Type Questions- 2 Free MCQ Practice Test with Solutions

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	Business Studies (BST) Class 12 53 videos\|208 docs\|49 tests

	Business Studies (BST) Class 12 53 videos\|208 docs\|49 tests

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