What is RAROC?

Correct Answer: A Bank Reconciliation Statement is a statement prepared periodically by a customer to explain the divergence (difference) between the bank balance as per cash book and the bank balance as per Pass Book It clearly shows the two differing balances and the outstanding items which causes the balances to disagree The objective of preparing such a statement is to know the causes of differences between the two balances and pass necessary correcting or adjusting entries in the books of the firm But it is to be noted that some differences are automatically adjusted For example - A cheque that has been sent for collection, but not yet collected, causes a difference between the balance as shown by the pass book and the balance as shown by the cash book, but no adjusting entry is required in the cash book for such a difference because, the bank will credit the firm?s account as soon as the cheque is collected

Correct Answer: contributions by owners

Explanation:

Comprehensive income is the sum of net income and other items that must bypass the income statement because they have not been realized, including items like an unrealized holding gain or loss from available for sale securities and foreign currency translation gains or losses.

Correct Answer: Fixed Minimum Reserve System

Explanation:

RBI issued currency notes under Fixed Minimum Reserve System.

Correct Answer: Percentage change in demand is less than the percentage change in price of the good

Explanation:

Demand is said to be inelastic, when the demand for the good doesn't change much or it is negotiable when the price of the good changed.

Correct Answer: Financing decisions

Explanation:

Financial management refers to the efficient and effective management of money (funds) in such a manner as to accomplish the objectives of the organization. It is the specialized function directly associated with the top management.

 

Hence, it deals with Financial decisions.

Correct Answer: Crossover rates have to do with the amount of earnings that are generated by two different but similar projects The crossover rate is the point at which the two projects achieve the same net present value In terms of investments, calculating a crossover rate between two similar securities can help an investor determine what to buy and what to sell

Correct Answer: When a company or corporation earns a profit or surplus, that money can be put to two uses it can either be re-invested in the business called retained earnings or it can be paid to the shareholders as a dividends

Correct Answer: Bull market is that market where stock value are expected rise and people will have tendency to sell their stock so as to earn profit out of it Thus sudden push from the suppliers will gradually niutalise the market

Correct Answer: Internal Rate of Return is that rate of Return at which the net present value is equal to Zero or it is the Rate which equates the present value of the cash inflows to the cash outflows NPV = Cash Inflow - Cash outflow NPV = Zero

Correct Answer: EBITDA stands for earnings before interest, taxes, depreciation, and amortization EBITDA came into wide use among private capital firms, wanting to calculate what they should pay for a business