Correct Answer:
B. Positive
A positive NPV adds value to shareholders.
November 13, 2026 · Accounting and Finance MCQs, Financial Management & Analysis MCQs
According to the NPV rule, an independent project should be accepted if its NPV is:
Related MCQs
A bonus issue of shares:
A.
Raises new cash for the company
B.
Capitalizes reserves and brings in no cash
C.
Reduces the number of shares
D.
Is a payment of cash dividend
Correct answer is:
B. Capitalizes reserves and brings in no cash
Do you agree with this answer?
Under the accrual basis of accounting in the public sector, transactions are recognized when:
A.
Cash is received only
B.
Cash is paid only
C.
They occur, regardless of when cash is received or paid
D.
The budget is approved
Correct answer is:
C. They occur, regardless of when cash is received or paid
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In vertical analysis, each item in a financial statement is expressed as a percentage of:
A.
The same item in the previous year
B.
Industry average
C.
A base figure such as total assets or sales in the same period
D.
Net profit only
Correct answer is:
C. A base figure such as total assets or sales in the same period
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Under IAS 37, a provision is recognized when:
A.
There is a present obligation from a past event, an outflow is probable and a reliable estimate can be made
B.
A future loss is merely possible
C.
The management plans to spend money someday
D.
The auditor requires it
Correct answer is:
A. There is a present obligation from a past event, an outflow is probable and a reliable estimate can be made
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Fixed costs are Rs. 60,000, selling price is Rs. 50 per unit and variable cost is Rs. 30 per unit. The break-even point in units is:
A.
3,000 units
B.
2,000 units
C.
1,200 units
D.
6,000 units
Correct answer is:
A. 3,000 units
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Actual quantity used is 480 units, standard quantity allowed is 500 units and the standard price is Rs. 10. The material usage variance is:
A.
Rs. 200 adverse
B.
Rs. 200 favorable
C.
Rs. 5,000 favorable
D.
Rs. 4,800 adverse
Correct answer is:
B. Rs. 200 favorable
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