FIN 101 CBT Practice

Table of Contents

📘 FIN 101 CBT PRACTICE TEST – IMPORTANT INSTRUCTIONS

Take your time to read the instructions carefully before starting this test.

📝 Test Details

Total Questions: 40 questions

Time Allowed: 15 – 20 minutes

This gives you very few seconds per question, so manage your time wisely.

✅ If you can score at least 60%, you can be rest assured that you’ll ace THA 213 in the real exam.

PS:

In the actual GST exam, you’ll likely be asked between 40 – 60 questions.

⚠️ EXAM STRATEGY & TIPS

Do not rush into answering questions.
Don’t waste too much time on questions you don’t know — skip and move on.
Start with questions that don’t involve calculations to save time.
Always crosscheck your answers.
Don’t be in a hurry to submit — you’re not in a competition.
Don’t be scared — getting an A is very achievable.
Don’t be overconfident either — calm your blood, no be only you sabi book 😌.
If you have any complaints, corrections, or feedback, please use the comment box.

📊 GRADING SCALE

70 – 100 → A

60 – 69 → B

50 – 59 → C

45 – 49 → D

40 – 44 → E

0 – 39 → F

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Pos.	Name	Score	Duration
1	Hezekiah	65 %	13 minutes 42 seconds
2	Aish	63 %	8 minutes 8 seconds
3	Amidat	55.5 %	12 minutes 32 seconds
4	Elizabeth	51 %	11 minutes 5 seconds
5	Alex	45 %	8 minutes
6	Vincent	33 %	10 minutes 49 seconds

FIN 101

1 / 40

1. Sale of goods for cash will improve the __________ ratio.

A. Quick

B. Debt-equity

C. Proprietary

D. Operating

2 / 40

2. Short-term finance is usually available to businesses for a period not exceeding __________.

A. 1 year

B. 3 months

C. 6 months

D. 5 years

3 / 40

3. Cost of revenue from operations is equal to revenue from operations minus __________.

A. Gross profit

B. Purchases

C. Closing inventory

D. Net profit

4 / 40

4. Debenture holders are regarded as __________ of the company.

A. Owners

B. Creditors

C. Managers

D. Promoters

5 / 40

5. Inventory is classified as a __________ asset.

A. Liquid

B. Intangible

C. Fixed

D. Current

6 / 40

6. Quick ratio is also known as __________ ratio.

A. Liquid

B. Activity

C. Solvency

D. Current

7 / 40

7. Dividend payable to ordinary shareholders is __________.

A. Fixed

B. Compulsory

C. Guaranteed

D. Variable

8 / 40

8. Prepaid expenses are excluded when computing __________ ratio.

A. Proprietary

B. Quick

C. Debt

D. Current

9 / 40

9. Preference shares have characteristics of both shareholders and __________.

A. Creditors

B. Debtors

C. Employees

D. Managers

10 / 40

10. An overdraft permits a business to overspend its bank account up to an agreed limit.

A. False

B. True

11 / 40

11. Current assets are expected to be realized within __________.

A. 1 year

B. 6 months

C. 2 years

D. 9 months

12 / 40

12. The ratio used to measure the capital structure of a firm is the __________ ratio.

A. Current

B. Operating

C. Debt-equity

D. Quick

13 / 40

13. A debenture is regarded as a __________ loan.

A. Short-term

B. Non-interest bearing

C. Temporary

D. Long-term

14 / 40

14. Debt-equity ratio compares long-term debts with __________.

A. Shareholders’ funds

B. Total assets

C. Fixed assets

D. Current assets

15 / 40

15. The process of calculating future value of present money is known as __________.

A. Depreciation

B. Amortization

C. Discounting

D. Compounding

16 / 40

16. Debt-equity ratio compares long-term debts with __________.

A. Shareholders’ funds

B. Total assets

C. Fixed assets

D. Current assets

17 / 40

17. Payment to creditors using cash will generally __________ the current ratio.

A. Cancel

B. Stabilize

C. Increase

D. Decrease

18 / 40

18. Current ratio is calculated as current assets divided by __________.

A. Liquid assets

B. Fixed assets

C. Capital employed

D. Current liabilities

19 / 40

19. The ideal quick ratio is __________

A. 1 : 2

B. 2 : 1

C. 3 : 1

D. 1 : 1

20 / 40

20. The ratio that measures the relationship between liquid assets and current liabilities is __________.

A. Quick ratio

B. Debt-equity ratio

C. Current ratio

D. Proprietary ratio

21 / 40

21. A firm with current assets greater than current liabilities has __________ working capital.

A. Fictitious

B. Positive

C. Zero

D. Negative

22 / 40

22. Shares, bonds and debentures are examples of __________ securities.

A. Marketable

B. Short-term

C. Temporary

D. Long-term

23 / 40

23. Excessive liquidity may result in __________ profitability.

A. Higher

B. Stable

C. Unlimited

D. Lower

24 / 40

24. Credit purchase of goods will __________ current liabilities.

A. Increase

B. Stabilize

C. Eliminate

D. Reduce

25 / 40

25. Current ratio is classified as a __________ ratio.

A. Liquidity

B. Activity

C. Profitability

D. Solvency

26 / 40

26. Operating ratio relates operating cost to __________.

A. Capital employed

B. Net revenue from operations

C. Net assets

D. Gross profit

27 / 40

27. Liquidity of a firm is measured by its ability to meet __________ obligations.

A. Long-term

B. Profit

C. Short-term

D. Capital

28 / 40

28. Proprietary ratio is calculated as shareholders’ funds divided by __________.

A. Current liabilities

B. Long-term debts

C. Fixed assets

D. Total assets

29 / 40

29. Inventory is excluded when calculating __________ assets.

A. Fixed

B. Current

C. Liquid

D. Intangible

30 / 40

30. The two basic measures of liquidity are current ratio and __________.

A. Operating ratio

B. Quick ratio

C. Gross profit ratio

D. Debt-equity ratio

31 / 40

31. Liquid assets include cash, bank balance and __________.

A. Goodwill

B. Bills receivable

C. Fixed assets

D. Inventory

32 / 40

32. Purchase of goods for cash will __________ the current ratio.

A. Improve

B. Eliminate

C. Not change

D. Reduce

33 / 40

33. Ordinary shareholders are regarded as the __________ owners of a business.

A. Temporary

B. Nominal

C. Real

D. Legal only

34 / 40

34. Marketable securities are regarded as __________ assets.

A. Fictitious

B. Liquid

C. Intangible

D. Fixed

35 / 40

35. An increase in cash collected from debtors will __________ the current ratio.

A. Improve

B. Decrease

C. Eliminate

D. Distort

36 / 40

36. Banks require __________ as security for their loans.

A. Shares

B. Collateral

C. Profits

D. Dividends

37 / 40

37. A higher quick ratio indicates better __________ position.

A. Liquidity

B. Activity

C. Profitability

D. Solvency

38 / 40

38. Share capital refers to money contributed by __________.

A. Employees

B. Managers

C. Shareholders

D. Creditors

39 / 40

39. Working capital is the difference between current assets and __________.

A. Capital

B. Long-term liabilities

C. Fixed assets

D. Current liabilities

40 / 40

40. The concept that money today is worth more than money tomorrow is known as __________.

A. Time value of money

B. Value of money

C. Cost of capital

D. Time money

Your score is

FIN 101 CBT Practice