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Question
State, with reason, whether the following statement is True or False.
Financial management is essential for all types of organisation.
Options
True
False
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Solution
This statement is True.
- The business organisation irrespective of its type and nature needs finance for its formation, for carrying out day – to – day activities, for development and expansion, etc.
- Financial management is essential for all types of business organisation as it deals with procurement of funds and their efficient and effective utilization in the business.
- Financial management deals with planning, organizing, directive and controlling financial activities of business organisations.
- Generally all business activities are supported by the savings which comes from the society. Many a times these savings are not adequate to meet the financial requirement of the business. It is therefore necessary that available scarce fund must be utilized systematically and more efficiently.
- Financial management plays a very important role in making the best use of financial resources.
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RELATED QUESTIONS
| Group 'A' | Group 'B' | ||
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| 2 | Retained profit | b | Deposits less than Rs. 20,000 |
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| 4 | Small depositors | d | 1996 |
| 5 |
Depository Act |
e | Management of business funds |
| f | Borrowed capital | ||
| g | Protect interest of debentures holders | ||
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| j | 1956 |
Advice to Board of Directors in respect of financial matter is given by _______.
Under which heads are the following shown in a company's Balance Sheet:
(i) Public Deposits
(ii) Office Furniture
(iii) Prepaid Rent
(iv) Outstanding Salaries
(v) Computer Software
(vi) Interest Accrued on Investment
(vii) Trade Payables payable after 12 months from the date of Balance Sheet?
Identify the major heads under which the following items will be shown in the Balance Sheet of a company as per Schedule III of Companies Act, 2013:
(i) Provision for Tax
(ii) Loan payable on demand
(iii) Computer and related equipment
(iv) Goods acquired for trading
Under which major headings and sub-headings the following items will be shown in the Balance Sheet of a company as per schedule III of Companies Act, 2013?
(i) Provision for Employee Benefits.
(ii) Calls-in-Advance.
Prepare Balance Sheet of Recovery Ltd. as per Schedule III of the Companies Act, 2013:
| ₹ | |
| 10% Debentures of ₹ 100 each | 1,90,000 |
| Stock-in-Trade (inventories) | 40,000 |
| Goodwill | 20,000 |
| Provision for Tax | 60,000 |
Totalting of Balance Sheet is not required.
From the following information extracted from the books of Howrach Ltd., prepare Balance Sheet of the company as at 31st March, 2026, as per Schedule III of the Companies Act, 2013:
| (₹ in '000) | (₹ in '000) | ||
| Long-term Borrowings | 1,000 | Property, Plant and Equipment | 1,600 |
| Trade Payable | 60 | Inventories | 40 |
| Share Capital | 800 | Trade Receivables | 160 |
| Reserves and Surplus | 180 | Cash and Cash Equivalents | 240 |
Prepare Balance Sheet of HP Ltd. as at 31st March, 2026 from the following information:
| ₹ | ₹ | ||
| Equity Share Capital | 20,00,000 | Workmen Compensation Reserve | 1,00,000 |
| 12% Preference Share Capital | 10,00,000 | Surplus, i.e., Balance in Statement of Profit and Loss (Cr.) | 3,00,000 |
| Fixed Assets (At cost) | 46,60,000 | Stock | 6,00,000 |
| Accumulated Depreciation | 16,60,000 | Sundry Debtors | 8,00,000 |
| Investments | 4,00,000 | Cash | 1,50,000 |
| Current Liabilities | 8,00,000 | Loans and Advances | 50,000 |
| 12% Debentures | 6,00,000 | Provision for Taxation | 2,00,000 |
Calculate Cost of Materials Consumed from the following:
Opening Inventory of Materials ₹3,50,000; Finished Goods ₹75,000; Stock-in-Trade ₹2,00,000; Closing Inventory of: Materials ₹3,25,000; Finished Goods ₹85,000; Stock-in-Trade ₹1,50,000; Purchases during the year: Raw Material ₹17,50,000; Stock-in-Trade ₹9,00,000.
From the following information, calculate Change in Inventory of Finished Goods: Opening Inventory and Closing Inventory of Finished Goods ₹2,00,000 and ₹1,75,000 respectively.
From the following information, calculate Change in Inventory of Work-in-Progress: Opening and Closing Work-in-Progress ₹1,00,000 and ₹1,15,000 respectively.
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(i) Interest paid on Borrowing from prince Finance Ltd.;
(ii) Interest paid on Term Loan to Bank;
(iii) Interest paid on Public Deposits;
(iv) Loss on Issue of Debentures Written off; and
(v) Bank Charges.
Financial management is based on three broad financial decisions. What are these?
For optimal procurement of funds, a finance manager identifies different available sources and compares those items in terms of cost and associated risks. Identify concept highlighted in the above lines.
The foremost objective of financial management is :
Which of the following statements is false regarding financial management?
The foremost objective of financial management is:
