Research Methodology and Project Report- 2

LIST OF ATTEMPTED QUESTIONS AND ANSWERS

Multiple Choice Multiple Answer
Question The permanent requirement of working capital should be financed out of :-
Correct Answer Debentures , Cash Profits , Shares
Your Answer Debentures , Cash Profits , Shares

Multiple Choice Multiple Answer
Question The sources of long term and medium term finance are :-
Correct Answer Equity shares , Public deposit
Your Answer Equity shares , Bridge loan , Public deposit

Multiple Choice Single Answer
Question The emphasis of the Banks and Financial institutions particularly in India has shifted from ‘Sanctions’, ‘Disbursements’ and ‘Security-orientation’ to ‘Recovery/Recycling’ and :-
Correct Answer Activity orientation
Your Answer Activity orientation

Multiple Choice Single Answer
Question Technology, design, layout of the plant as well as inputs and infrastructural facilities are to be considered under :-
Correct Answer Technical appraisal
Your Answer Financial appraisal

Select The Blank
Question Detailed Project Report is generally prepared from a ________ report with additional information.
Correct Answer Feasibility
Your Answer Feasibility

True/False
Question A high debt equity ratio may indicate that the financial stake of the creditors is more than that of the owners.
Correct Answer True
Your Answer True

Multiple Choice Single Answer
Question The formula for Break Even Point is :-
Correct Answer Fixed cost / ( Sales Price – Variables)
Your Answer (Profit after tax +Depreciation + Interest)/ Interest

Multiple Choice Single Answer
Question Receivables is categorised under :-
Correct Answer Current assets and liabilities
Your Answer Material inputs and utilities

Multiple Choice Multiple Answer
Question Ratios relating to working capital are :-
Correct Answer Current ratio , Internal measure , Quick ratio
Your Answer Current ratio , Debt Equity ratio , Internal measure

Select The Blank
Question Longer the duration of production cycle, higher the requirement of ________.
Correct Answer Working capital
Your Answer Fixed assets

Multiple Choice Multiple Answer
Question In the Detailed Project Report, Management aspects includes :-
Correct Answer Determination , Organisation Building , Person / system oriented
Your Answer Organisation Building , Person / system oriented , Promoter’s equity / stake

True/False
Question Financial analysis based on accounting ratios will give mis-leading results if the effects of changes in price level are not taken into account.
Correct Answer True
Your Answer True

Multiple Choice Multiple Answer
Question In the Detailed Project Report, Technical aspects includes :-
Correct Answer Plant capacity , Quality standards , Raw material requirement
Your Answer Plant capacity , Quality standards , Raw material requirement

Select The Blank
Question Inflow of funds may not necessarily result in ________.
Correct Answer Inflow of cash
Your Answer Decrease in funds

Multiple Choice Multiple Answer
Question Building cost consists of :-
Correct Answer Factory building , Auxiliary buildings , Administrative block
Your Answer cost of development , Factory building , Auxiliary buildings

Match The Following
Question Correct Answer Your Answer

Increase in current liabilities Decreases working capital Stability of funds

Increase in liabilities Inflow of funds Inflow of funds

Decrease in liabilities Outflow of funds Increases working capital

Increase in current assets Increases working capital Outflow of funds

Select The Blank
Question Sometimes the term ________ is interpreted as cash equivalent i.e. cash and marketable securities.
Correct Answer Fund
Your Answer Fund

True/False
Question Name of the finance manager comes under the Project organisation category of the Project report.
Correct Answer True
Your Answer False

True/False
Question Change in the project concept itself may lead to cost and time overrun.
Correct Answer True
Your Answer True

True/False
Question The maximum Seed Capital assistance provided by IDBI under the project will be restricted to 50% of the required promoter’s contribution or Rs. 50 lakhs whichever is lower.
Correct Answer False
Your Answer True

Match The Following
Question Correct Answer Your Answer

Project organisation Finance manager Completion date of the project

General category of Project report Location of factory Reasons for cost escalations

Cost aspect of the project report Consultancy fees Finance manager

Financing plan Unsecured loans Location of factory

True/False
Question Trend projection method is the important technique for forecasting demand.
Correct Answer True
Your Answer True

Multiple Choice Multiple Answer
Question Production and sales aspect of Visit report consists of :-
Correct Answer Utilisation of installed capacity , Input availability , Sales trends
Your Answer Utilisation of installed capacity , Input availability

Multiple Choice Multiple Answer
Question The sources of cash are :-
Correct Answer Cash from operations , Sale of machinery , Issue of new shares
Your Answer Purchase of fixed assets , Cash from operations , Sale of machinery

Multiple Choice Multiple Answer
Question External sources of cash are as follows :-
Correct Answer Issue of new shares , Long term loans , Short term borrowings
Your Answer Issue of new shares , Long term loans , Short term borrowings

True/False
Question Production line diagrams show the organisation structure of the project along with information on location, personnel required for various departments, and their inter-relationship.
Correct Answer False
Your Answer True

Select The Blank
Question ________ is a current asset
Correct Answer Book debts
Your Answer Book debts

Select The Blank
Question The company having ________, is appropriate for the strategic posture of Defensive under the SPACE approach.
Correct Answer Lacks both competitive advantage as well as financial strength and belongs to a not so attractive industry, operating in an unstable environment
Your Answer High financial strength, high industrial strength, enjoying a competitive advantage and belonging to an attractive industry, operating in a relatively stable environmental conditions

Multiple Choice Single Answer
Question Management aspect of detailed project report includes
Correct Answer Organisation structure
Your Answer Demand forecasting

Select The Blank
Question ________ profitability reduces the strain on working capital.
Correct Answer High
Your Answer High

Multiple Choice Multiple Answer
Question The following are the sources of funds :-
Correct Answer Operating Profit , Non operating Income
Your Answer Operating Profit , Operating Loss , Non operating Income

Multiple Choice Single Answer
Question The cash flow of all the years during the expected life of the project are discounted at a pre-determined cut off rate and :-
Correct Answer Net Present value is obtained
Your Answer Internal rate of return is obtained

Multiple Choice Multiple Answer
Question The objectives of the funds flow statement is as follows :-
Correct Answer To find out the uses of loans raised by the business , To indicate the financial strength and weakness of the business , To help to understand the changes in assets as well as asset sources which are not revealed by the income statement
Your Answer To find out the uses of loans raised by the business , To indicate the financial strength and weakness of the business , To help to understand the changes in assets as well as asset sources which are not revealed by the income statement

Multiple Choice Single Answer
Question Cost of materials include :-
Correct Answer Cost of components and consumable stores
Your Answer Cost of electricity

True/False
Question The Detailed Project report must indicate the gestation period of the project.
Correct Answer True
Your Answer True

Multiple Choice Single Answer
Question Strategic Position and Action Evaluation Model :-
Correct Answer Is an approach to hammer out an appropriate strategic posture for a firm and its individual business
Your Answer Which is highly respected for the sophistication, maturity and quality in its planning systems

Select The Blank
Question Location of the factory comes under the ________ category of the Project report.
Correct Answer General
Your Answer General

Select The Blank
Question Retained earnings is a source of ________ finance.
Correct Answer Internal
Your Answer Internal

Multiple Choice Multiple Answer
Question General category of the Project report consists of :-
Correct Answer Name of the Industrial concern , Proposed product , Location of the factory
Your Answer Name of the Industrial concern , Proposed product , Location of the factory

Select The Blank
Question Short term finance is normally for a period upto ________ year.
Correct Answer One
Your Answer Two

Multiple Choice Single Answer
Question Appointments made at senior level during the half-year is categorised under :-
Correct Answer Organisation and management
Your Answer Current assets and liabilities

Select The Blank
Question Commission outstanding is ________ of funds.
Correct Answer Application
Your Answer Application

Multiple Choice Single Answer
Question The statement which shows the movement of cash into and out of firm’s kittie is known as :-
Correct Answer Cash flow statement
Your Answer Profit and Loss statement

Multiple Choice Single Answer
Question Cost of utilities include :-
Correct Answer Cost of electricity
Your Answer Cost of components and consumable stores

Multiple Choice Single Answer
Question Marketing aspect of Detailed Project report includes :-
Correct Answer Demand forecasting
Your Answer Detailed Project Engineering

True/False
Question In both the extreme situations of trade cycles i.e. Inflation and depression, requirement of working capital may be high.
Correct Answer True
Your Answer False



Multiple Choice Multiple Answer
Question While choosing the location for a project, the following factors should be considered :-
Correct Answer Proximity to raw materials and markets , Availability of infrastructure , Government policies and other factors
Your Answer Proximity to raw materials and markets , Plant capacity , Availability of infrastructure