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Home » TOP 21 Working Capital Management MCQ With Answers

TOP 21 Working Capital Management MCQ With Answers

Given below are Working Capital Management MCQ with answers updated in 2021. These Working Capital multiple choice questions are useful for MBA, BBA, B Com, M Com, PGDM, BA, MA, UGC NET, SET, MPSC, UPSC and Ph D exams.

The major current assets are _____

A. cash and marketable securities

B. accounts receivable (debtors)

C. inventory (stock)

D. All of the above

View Answer

D. All of the above

The basic current liabilities are _____

A. accounts payable and bills payable

B. bank overdraft

C. outstanding expenses.

D. All of the above

View Answer

D. All of the above

There are two concepts of working capital – gross and ____

A. Zero

B. Net

C. Cumulative

D. distinctive

View Answer

B. Net

Working capital is also known as___ capital.

A. current asset

B. Operating

C. projecting

D. Operation capital

View Answer

B. Operating

______ working Capital refers to the firm’s investment in current assets.

A. Zero

B. Net

C. Gross

D. Distinctive

View Answer

C. Gross

In finance, “working capital” means the same thing as _______ assets.

A. Current

B. Fixed

C. Total

D. All of the above

View Answer

A. Current

Working capital is calculated as _____

A. Core current assets less core current liabilities

B. Current assets less current liabilities

C. Core current assets less current liabilities

D. Liquid assets less current liabilities

View Answer

B. Current assets less current liabilities

______ working capital refers to the difference between current assets and current liabilities.

A. Zero

B. Net

C. Gross

D. Distinctive

View Answer

B. Net

A _______ net working capital will arise when current assets exceed current liabilities.

A. Summative

B. Negative

C. Excessive

D. Positive

View Answer

D. Positive

A ______ net working capital occurs when current liabilities are in excess of current assets.

A. Positive

B. Negative

C. Excessive

D. Zero

View Answer

B. Negative

_____is not an advantages of trade credit.

A. buyout financing

B. informality

C. easy availability

D. flexibility

View Answer

A. buyout financing

________ refers to the funds, which an organisation must possess to finance its day to day operations.

A. Retained earnings

B. Fixed capital

C. Working Capital

D. All of the above

View Answer

C. Working Capital

Investment in current assets should be _____

A. just adequate

B. more

C. less

D. maximum

View Answer

A. just adequate

_______ varies inversely with profitability.

A. Risk

B. Assets

C. Liquidity

D. Revenue

View Answer

C. Liquidity

Capital intensive firms rely on ______

A. debt

B. retained earnings

C. short term debts

D. Equity

View Answer

A. debt

On the basis of _____, working capital is classified as gross working capital and net working capital.

A. concept

B. time

C. future

D. work

View Answer

A. concept

______ cycle analyzes the accounts receivable, inventory, and accounts payable cycles in terms of a number of days?

A. Business

B. Current asset

C. Operation

D. Operating

View Answer

D. Operating

_______ method is not used for calculating working capital cycle.

A. Trial and error method

B. Regression analysis method

C. Percentage of sales method

D. Operating cycle approach

View Answer

A. Trial and error method

On the basis of _____, working capital may be classified as: 1) Permanent or fixed working capital. 2) Temporary or variable working capital.

A. concept

B. time

C. future

D. work

View Answer

B. time

Operating cycle is also called as _____

C. Working cycle

A. Business cycle

D. Current asset cycle

B. Working capital cycle

View Answer

B. Working capital cycle

Spontaneous financing consists of ______

A. a line of credit

B. short-term loans

C. accounts receivable

D. accounts payable

View Answer

D. accounts payable

Above said Working Capital Management MCQ are helpful for students studying in various universities in India such as Pune University, Mumbai University, Anna University, and Calicut University.

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