Subject: BUSSINESS, MANAGEMENT & FINANCE

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BMF – Nov 2020 – L1 – SB – Q6 – Basics of Business Finance and Financial Markets

Explanation of loan covenants, reasons and benefits for share repurchase, and features of a finance lease arrangement.

Question

(a) For many loan agreements, the borrower is required to provide undertakings or guarantees of some kind.
Distinguish between covenants and guarantees. (5 Marks)

(b) State THREE reasons why a company will repurchase its shares and THREE benefits that will accrue to the company for doing so. (6 Marks)

(c) Companies can acquire assets with finance lease instead of buying assets with equity or debt capital.
State SIX main features of a finance lease arrangement. (9 Marks)

(Total 20 Marks)

Answer

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Tags: Corporate finance, Finance lease, Guarantees, Loan Covenants, Share repurchase
Level: Level 1

Topic: Basics of Business Finance and Financial Markets
Series: NOV 2020

BMF – Nov 2020 – L1 – SB – Q5 – Investment Decisions

Evaluate the investment project using IRR and advise management on the project feasibility.

Question

Uhuru Nigeria Limited wants to buy a new item of equipment which will be used to improve service delivery to its customers. Using the internal rate of return (IRR) method of investment appraisal, you are required to evaluate the project and advise the management of the company. Estimated cash flows from the project are as provided below:

Year	Cash Flow (N)
0	(400,000)
1	140,000
2	150,000
3	170,000
4	190,000

The expected minimum required rate of return of the company is fixed at 25%.

Answer

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Tags: Capital Budgeting, Cash Flow Analysis, Internal Rate of Return (IRR), Investment Appraisal, Rate of Return
Level: Level 1

Topic: Investment Decisions
Series: NOV 2020

BMF – Nov 2020 – L1 – SB – Q4 – The Role of Professional Accountants in Business and

Explanation of ethical dilemmas, powers of professional bodies, and methods for resolving ethical dilemmas.

Question

(a) Distinguish between ethical dilemma and conflict of interest. (4 Marks)
(b) Globally, professional bodies are backed by law, consequently, a measure of authority is conferred upon them which they regularly exercise whenever the situation or circumstance demands.
State THREE powers of a professional body. (6 Marks)
(c) State FIVE possible ways of resolving ethical dilemma in a business environment. (10 Marks)

(Total 20 Marks)

Answer

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Tags: Business Ethics, Conflict of Interest, Conflict Resolution, Ethical dilemma, Professional Body Powers
Level: Level 1

Topic: The Role of Professional Accountants in Business and Society
Series: NOV 2020

BMF – Nov 2020 – L1 – SB – Q2 – Management, Individual, and Organisational Behaviour

Explanation of reinforcement theory and self-efficacy, and their applications in the business environment.

Question

(a) Describe reinforcement theory and state the main assumption that guides reinforcement theory.
(b) Explain the ways by which reinforcement theory can be employed in the business environment.
(c) What is self-efficacy? State and explain the ways by which levels of self-efficacy impact human functions.

(Total 20 Marks)

Answer

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Tags: Behavioral Theory, Motivation, Positive Reinforcement, Reinforcement Theory
Level: Level 1

Topic: Management, Individual, and Organizational Behavior
Series: NOV 2020

BMF – Nov 2020 – L1 – SB – Q1b – The Business Environment

State five functions each for the Administration and Finance departments of an organization.

Question

Innoson Transport Company plans to create two new departments, administration and finance. In view of this, two managers will be hired to oversee these functional units.
State FIVE functions of each of the two departments.

Answer

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Tags: Cultural Differences, Hofstede's Dimensions, International business, National Culture
Level: Level 1

Topic: The Business Environment
Series: NOV 2020

BMF – Nov 2020 – L1 – SB – Q1a – The Business Environment

Identify and explain Hofstede's five dimensions of national culture.

Question

Geert Hofstede gave an international perspective on suggesting that culture differs among nations.

Identify and explain the FIVE dimensions of national culture as suggested by Hofstede.

Answer

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Tags: Cultural Analysis, Cultural Dimensions, Hofstede, International business, National Culture
Level: Level 1

Topic: The Business Environment
Series: NOV 2020

BMF- Nov 2020 – L1 – SA – Q20 – The Business Environment

Identify the correct statement regarding the laws of demand and supply.

Question

Which of the following statements in relation to the laws of demand and supply is correct?
A. An increase in price leads to an increase in demand
B. A decrease in price leads to a decrease in demand
C. If demand is highly elastic, a reduction in the sales price will result in an increase in total sales revenue
D. The quantity of a good that suppliers are willing to sell falls when the price of the good rises
E. The quantity of a good that suppliers are willing to sell rises when the price of the good falls

Answer

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Tags: Demand, Economic Laws, Supply
Level: Level 1

Topic: The Business Environment
Series: NOV 2020

BMF – Nov 2020 – L1 – SA – Q19 – The Business Environment

Identify a feature of monopolistic competition.

Question

Which of the following is a feature of monopolistic competition?
A. Small number of suppliers
B. Monitors the actions of the other firms
C. Faces a kinked demand curve
D. Knowledge is widespread, but not perfect
E. Decisions of one firm influence the decisions of other firms

Answer

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Tags: Economic theory, Market Features, Monopolistic Competition
Level: Level 1

Topic: The Business Environment
Series: NOV 2020

BMF – Nov 2020 – L1 – SA – Q18 – Business and Organizational Structures and Choices

Identify a key characteristic of a global company.

Question

One of the characteristics of a global company is that:
A. Management makes strategic decisions for each foreign market
B. Products are adapted to the requirements of the local market
C. Marketing is adapted in each country to suit the local culture
D. The value chain in each country of operation is optimised
E. The senior managers are likely to come from different countries

Answer

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Tags: Global Company, International Strategy, Management
Level: Level 1

Topic: Business and Organizational Structures and Choices
Series: NOV 2020

BMF – Nov 2020 – L1 – SA – Q17 – Communications in Business

Identify the decade when early communication models were developed.

Question

Early communication models were developed in the:
A. 1910s
B. 1920s
C. 1930s
D. 1940s
E. 1950s

Answer

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Tags: Business Communications, Communication Models, History
Level: Level 1

Topic: Communications in Business
Series: NOV 2020

BMF – MAY 2015 – L1 – SA – Q14 – Management, Individual, and Organisational Behaviour

Understanding how meeting employee social and psychological needs aligns with organizational goals.

Question

Meeting the social and psychological needs of employees in the fulfilment of organisational goals can be referred to as:

A. Motivating
B. Controlling
C. Organising
D. Planning
E. Coordinating

Answer

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Tags: Employee Needs, Motivation, Organisational Goals, Psychological needs, Social needs
Level: Level 1

Topic: Management, Individual, and Organizational Behavior
Series: MAY 2015

BMF – MAY 2015 – L1 – SA – Q13 – Basic Management Functions

Primary objective of strategic planning in business.

Question

ONE of the primary objectives of strategic planning is to achieve:

A. Business strategy
B. A sustainable competitive advantage
C. Purpose of production
D. An aspiration
E. Business idea

Answer

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Tags: Business Strategy, Competitive Advantage, Management objectives, Strategic Planning
Level: Level 1

Topic: Basic Management Functions
Series: MAY 2015

BMF – MAY 2015 – L1 – SA – Q12 – The Business Environment

Identifying the most appropriate term for individuals or groups interested in an organization.

Question

The most appropriate terminology that describes those who have interest in an organisation is:

A. Customers
B. Shareholders
C. Stakeholders
D. Management
E. Owners

Answer

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Tags: Business Environment, Business interests, Corporate Governance, Stakeholders
Level: Level 1

Topic: The Business Environment
Series: MAY 2015

BMF – MAY 2015 – L1 – SA – Q11 – Nature of Business, Types, and Objectives.

Identifying an alternative to shareholders' wealth maximisation.

Question

Which of the following is regarded as an alternative to shareholders’ wealth maximisation?

A. Long term stability
B. Long term growth
C. Corporate wealth maximisation
D. Share price maximisation
E. Cost minimisation

Answer

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Tags: Business Objectives, Corporate wealth, Shareholders' Wealth, Wealth Maximization
Level: Level 1

Topic: Nature of Business, Types, and Objectives
Series: MAY 2015

BMF – MAY 2015 – L1 – SA – Q10 – Business and Organizational Structures and Choices

Requirements for incorporating a limited liability company, excluding non-essential documents.

Question

The following are required to incorporate a limited liability company EXCEPT:

A. Memorandum of Association
B. Articles of Association
C. Statement of authorised share capital
D. Location of the registered office
E. Source of finance

Answer

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Tags: Articles of Association, Company Formation, Incorporation, Memorandum of Association, Share Capital
Level: Level 1

Topic: Business and Organizational Structures and Choices
Series: MAY 2015

BMF – MAY 2015 – L1 – SA – Q9 – Nature of Business, Types, and Objectives

Definition of an organization's mission in alignment with stakeholder expectations.

Question

An organisation’s mission can be defined as:

A. The overriding purpose in line with the values or expectations of stakeholders
B. The organisation’s business plan
C. The overriding purpose in line with the values or expectations of its owners
D. The desired future state of the organisation
E. The current state of the organisation

Answer

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Tags: Business Objectives, Mission Statement, Purpose, Stakeholders
Level: Level 1

Topic: Nature of Business, Types, and Objectives
Series: MAY 2015

BMF – May 2015 – L1 – SA – Q8 – Communications in Business

This question tests understanding of the type of communication referred to as "Grapevine" in organizational contexts.

Question

Which type of communication is Grapevine?

A. Formal
B. Informal
C. External
D. Formal and Informal
E. Internal and External

Answer

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Tags: Communication, Grapevine, Informal Communication
Level: Level 1

Topic: Communications in Business
Series: MAY 2015

BMF – May 2015 – L1 – SA – Q7 – Management, Individual, and Organisational Behaviour

This question focuses on identifying a key instrument used to influence and change organizational culture.

Question

Which of the following is a key instrument in changing organisational culture?

A. Training
B. Team membership
C. MBO Strategy
D. Problem analysis
E. Growth

Answer

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Tags: Change Management, Organisational Culture, Training
Level: Level 1

Topic: Management, Individual, and Organizational Behavior
Series: MAY 2015

BMF – May 2015 – L1 – SA – Q6 – Management, Individual, and Organisational Behaviour

This question tests the understanding of which management theory is closely related to Maslow’s higher-level needs.

Question

Which of the following theories has assumptions that are closely related to Maslow’s higher-level needs?

A. Theory X
B. Theory Y
C. Theory Z
D. Theory XY
E. Theory XYZ

Answer

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Tags: Maslow’s Hierarchy of Needs, Motivation, Theories of Management
Level: Level 1

Topic: Management, Individual, and Organizational Behavior
Series: MAY 2015

BMF – May 2015 – L1 – SA – Q5 – The Role of Professional Accountants in Business and Society

This question tests knowledge of ethical theories, specifically focusing on one that prioritizes self-interest as the basis for human conduct.

Question

Which of the following ethical theories expresses the view that human conduct should be based exclusively on self-interest?

A. Normative ethics
B. Applied ethics
C. Ethical egoism
D. Ethics of duty
E. Virtue ethics

Answer

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Tags: Ethical Theories, Ethics, Self-Interest
Level: Level 1

Topic: The Role of Professional Accountants in Business and Society
Series: MAY 2015

Subject: BUSSINESS, MANAGEMENT & FINANCE

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BMF – Nov 2020 – L1 – SB – Q6 – Basics of Business Finance and Financial Markets

Explanation of loan covenants, reasons and benefits for share repurchase, and features of a finance lease arrangement.

You're reporting an error for "BMF – Nov 2020 – L1 – SB – Q6 – Basics of Business Finance and Financial Markets"

BMF – Nov 2020 – L1 – SB – Q5 – Investment Decisions

Evaluate the investment project using IRR and advise management on the project feasibility.

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BMF – Nov 2020 – L1 – SB – Q4 – The Role of Professional Accountants in Business and

Explanation of ethical dilemmas, powers of professional bodies, and methods for resolving ethical dilemmas.

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BMF – Nov 2020 – L1 – SB – Q2 – Management, Individual, and Organisational Behaviour

Explanation of reinforcement theory and self-efficacy, and their applications in the business environment.

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BMF – Nov 2020 – L1 – SB – Q1b – The Business Environment

State five functions each for the Administration and Finance departments of an organization.

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BMF – Nov 2020 – L1 – SB – Q1a – The Business Environment

Identify and explain Hofstede's five dimensions of national culture.

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BMF- Nov 2020 – L1 – SA – Q20 – The Business Environment

Identify the correct statement regarding the laws of demand and supply.

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BMF – Nov 2020 – L1 – SA – Q19 – The Business Environment

Identify a feature of monopolistic competition.

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BMF – Nov 2020 – L1 – SA – Q18 – Business and Organizational Structures and Choices

Identify a key characteristic of a global company.

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BMF – Nov 2020 – L1 – SA – Q17 – Communications in Business

Identify the decade when early communication models were developed.

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BMF – MAY 2015 – L1 – SA – Q14 – Management, Individual, and Organisational Behaviour

Understanding how meeting employee social and psychological needs aligns with organizational goals.

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BMF – MAY 2015 – L1 – SA – Q13 – Basic Management Functions

Primary objective of strategic planning in business.

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BMF – MAY 2015 – L1 – SA – Q12 – The Business Environment

Identifying the most appropriate term for individuals or groups interested in an organization.

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BMF – MAY 2015 – L1 – SA – Q11 – Nature of Business, Types, and Objectives.

Identifying an alternative to shareholders' wealth maximisation.

You're reporting an error for "BMF – MAY 2015 – L1 – SA – Q11 – Nature of Business, Types, and Objectives."

BMF – MAY 2015 – L1 – SA – Q10 – Business and Organizational Structures and Choices

Requirements for incorporating a limited liability company, excluding non-essential documents.

You're reporting an error for "BMF – MAY 2015 – L1 – SA – Q10 – Business and Organizational Structures and Choices"

BMF – MAY 2015 – L1 – SA – Q9 – Nature of Business, Types, and Objectives

Definition of an organization's mission in alignment with stakeholder expectations.

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BMF – May 2015 – L1 – SA – Q8 – Communications in Business

This question tests understanding of the type of communication referred to as "Grapevine" in organizational contexts.

You're reporting an error for "BMF – May 2015 – L1 – SA – Q8 – Communications in Business"

BMF – May 2015 – L1 – SA – Q7 – Management, Individual, and Organisational Behaviour

This question focuses on identifying a key instrument used to influence and change organizational culture.

You're reporting an error for "BMF – May 2015 – L1 – SA – Q7 – Management, Individual, and Organisational Behaviour"

BMF – May 2015 – L1 – SA – Q6 – Management, Individual, and Organisational Behaviour

This question tests the understanding of which management theory is closely related to Maslow’s higher-level needs.

You're reporting an error for "BMF – May 2015 – L1 – SA – Q6 – Management, Individual, and Organisational Behaviour"

BMF – May 2015 – L1 – SA – Q5 – The Role of Professional Accountants in Business and Society

This question tests knowledge of ethical theories, specifically focusing on one that prioritizes self-interest as the basis for human conduct.

You're reporting an error for "BMF – May 2015 – L1 – SA – Q5 – The Role of Professional Accountants in Business and Society"

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