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. Trade payables are classified as __________ liabilities.

A. Contingent

B. Long-term

C. Fixed

D. Current

2 / 40

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

A. True

B. False

3 / 40

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

A. Current assets

B. Fixed assets

C. Shareholders’ funds

D. Total assets

4 / 40

4. Inventory is classified as a __________ asset.

A. Intangible

B. Fixed

C. Current

D. Liquid

5 / 40

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

A. Temporary

B. Legal only

C. Nominal

D. Real

6 / 40

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

A. Decrease

B. Eliminate

C. Improve

D. Distort

7 / 40

7. Hire purchase allows a business to acquire assets by __________.

A. Paying cash immediately

B. Borrowing without interest

C. Paying over a period

D. Leasing without payment

8 / 40

8. Share capital refers to money contributed by __________.

A. Creditors

B. Employees

C. Managers

D. Shareholders

9 / 40

9. Inflation is one of the factors affecting __________.

A. Share capital

B. Time value of money

C. Liquidity ratio

D. Operating ratio

10 / 40

10. Marketable securities are regarded as __________ assets.

A. Fictitious

B. Liquid

C. Intangible

D. Fixed

11 / 40

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

A. Liquid assets

B. Fixed assets

C. Current liabilities

D. Capital employed

12 / 40

12. Solvency ratios provide information about the firm’s __________ survival.

A. Long-run

B. Medium-run

C. Short-run

D. Immediate

13 / 40

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

A. Marketable

B. Temporary

C. Long-term

D. Short-term

14 / 40

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

A. 9 months

B. 1 year

C. 6 months

D. 2 years

15 / 40

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

A. Managers

B. Creditors

C. Owners

D. Promoters

16 / 40

16. Banks require __________ as security for their loans.

A. Dividends

B. Profits

C. Collateral

D. Shares

17 / 40

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

A. Long-term liabilities

B. Current liabilities

C. Capital

D. Fixed assets

18 / 40

18. Excessive liquidity may result in __________ profitability.

A. Stable

B. Unlimited

C. Higher

D. Lower

19 / 40

19. Dividend payable to ordinary shareholders is __________.

A. Guaranteed

B. Fixed

C. Variable

D. Compulsory

20 / 40

20. Quick ratio is also known as __________ ratio.

A. Activity

B. Current

C. Liquid

D. Solvency

21 / 40

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

A. Increase

B. Stabilize

C. Decrease

D. Cancel

22 / 40

22. Ordinary shareholders usually have __________ rights.

A. Voting

B. Limited

C. Creditor

D. No

23 / 40

23. Inventory is excluded when calculating __________ assets.

A. Fixed

B. Current

C. Intangible

D. Liquid

24 / 40

24. The process of determining the present value of future cash flows is called __________.

A. Valuation

B. Capitalizing

C. Discounting

D. Compounding

25 / 40

25. Patents and copyrights fall under __________ assets.

A. Current

B. Liquid

C. Fixed tangible

D. Intangible

26 / 40

26. Operating ratio relates operating cost to __________.

A. Net revenue from operations

B. Net assets

C. Capital employed

D. Gross profit

27 / 40

27. Goodwill is classified as a __________ asset.

A. Liquid

B. Intangible

C. Tangible

D. Current

28 / 40

28. Liquid ratio is calculated by dividing liquid assets by __________.

A. Current liabilities

B. Shareholders’ funds

C. Total assets

D. Fixed liabilities

29 / 40

29. A debenture is regarded as a __________ loan.

A. Long-term

B. Short-term

C. Temporary

D. Non-interest bearing

30 / 40

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

A. Value of money

B. Cost of capital

C. Time value of money

D. Time money

31 / 40

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

A. Current liabilities

B. Long-term debts

C. Fixed assets

D. Total assets

32 / 40

32. The ideal current ratio is __________.

A. 2 : 1

B. 3 : 1

C. 1 : 1

D. 1 : 3

33 / 40

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

A. Debt-equity ratio

B. Quick ratio

C. Proprietary ratio

D. Current ratio

34 / 40

34. The ideal quick ratio is __________

A. 1 : 2

B. 3 : 1

C. 2 : 1

D. 1 : 1

35 / 40

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

A. Positive

B. Zero

C. Fictitious

D. Negative

36 / 40

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

A. Purchases

B. Gross profit

C. Closing inventory

D. Net profit

37 / 40

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

A. Short-term

B. Profit

C. Long-term

D. Capital

38 / 40

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

A. Quick

B. Debt-equity

C. Operating

D. Proprietary

39 / 40

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

A. Bills receivable

B. Goodwill

C. Inventory

D. Fixed assets

40 / 40

40. Prepaid expenses are excluded when computing __________ ratio.

A. Proprietary

B. Debt

C. Current

D. Quick

Your score is

FIN 101 CBT Practice