CORPORATE RESTRUCTURING Practice MCQ Questions

Multiple Choice Questions 4 Pages

APJ Abdul Kalam Technological University

Bachelor of Finance Management

Contributed by

Gulab Sawhney

QUESTIONBANK
CORPORATERESTRUCTURING
SEMVI‐OCT.2020
SrNo.
Question A B C D
1
What is defined as the procedure that is involved in changing the organization of business? Financial restructuring
Organisational
restructurin
g
Corporate
restructurin
g
None of the above
2
What is called an expression by which company can consolidate its business operations & reinforce
its
p
osition?
Organisational
restructurin
g
Financial restructuring
Corporate
restructurin
g
None of the above
3
What has been done for improving poor financial performance to gain market opportunities? Financial restructuring
Organisational
restructurin
g
Corporate
restructurin
g
None of the above
4
What brings new & advance technologies in order to achieve & improve productivity &
p
erformance?
Technological
restructurin
g
Financial restructuring
Organisational
restructurin
g
None of the above
5
What increase the efficiency & effectiveness of the organization?
Technological
restructurin
g
Organisational
restructurin
g
Corporate
restructurin
g
None of the above
6
What is called a combination of two or more business into one business? Demerger Merger
Inbound merger None of the above
7
What is called as an act of acquiring effective control by one company over assets or management
of another com
p
an
y
?
Franchising Acquisition
Both A and B None of the above
8
Which form of corporate restructuring in which entities of business operations are segregated in
one or more com
p
onents?
Merger Demerger
Reverse merger None of the above
9
What is defined as an management where one party allows another party the right to use its trade
name?
Franchising Acquisition
Merger
None of the above
10
What is called an one time exercise for an organisation but it may have perpetual influence on the
business
?
Corporate restructuring
Organisational
restructurin
g
Financial restructuring
None of the above
11
What is the name of a tool for obtaining synergy, dynamism and perpetuity? Financial restructuring Corporate restructuring
Technological
restructurin
g
None of the above
12
Which is an inorganic growth strategy?
Technological
restructurin
g
Organisational
restructurin
g
Corporate
restructurin
g
None of the above
13
What has paved way to a strong corporate restructuring in India?
MRTP TCL
LPG
None of the above
14
What can be developed into profitable venture by using Corporate Restructuring?
IdleTime
Idle Cash substaintial cash
None of the above
15
Which Restructuring deals with restructuring of capital base and raising finance for new projects? Technological Financial Organisational
None of the above
16
New and advanced technologies have been introduced in which restructuring in order to improve
the
p
roductivit
y
and
p
erformance?
Technological Technological Financial
None of the above
17
Which restructuring increases the efficiency and effectiveness of the organisation? Financial Organisational Technological
None of the above
18
What is the name of a process by which company is allowed to extinguish or reduce liability? Reduction of capital
ReductionofAssets ReductionsofLiability
None of the above
19
Spin-off is a form of what? Demerger Merger
Both A and B None of the above
20
Which is the process of making changes in the composition of a firms one or more business
portfolio in order to have a more profitable enterprise?
Corporate
Reconstruction Communication Ownership Capital Structure
21
What is the name of the process for changing the structure of an orgnazation such as reducing the
hierarchical levels? Financial Restructuring
Organizational
Restructuring
Corporate
Restructuring Internal Reconstruction
22
State an arrangement whereby the assets of two ro more companies come under the control of one
company? Merger Buyout Joint Venture De-merger
23
Which merger involves firms engaged in unrelated types of activities? Vertical Horizontal Conglomerate Demerger
24
Which company distributes its shareholding in subsidiary to its shareholders thereby not changing
the ownership pattern? Strategic Alliance Split off Reverse Merger Spin off
25
When existing company is dissolved to form few new companies, it is called as what ? Reverse Merger Split off Split up Strategic Alliance
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26
What do you mean by the action of an organization or government selling or liquidating an asset or
subsidiery? Merger Joint Venture Takeover Disinvestment
27
An acquirer takes over the control of the target company means what? Joint Venture Takeover Disinvestment Demerger
28
Which is the corporate strategy of combined different companies into a single company in order to
enhance the financial & o
p
erational stren
g
ths of both or
g
anizations?
Reverse Merger Demerger Merger
None of the above
29
Which merger results into achieving economies of scale and control of bigger market share?
Reverse
Vertical horizontal
None of the above
30
Which merger results into cost efficiency, operational efficiency, increased margins and more
control over
p
roduction or distribution
p
rocess?
Vertical horizontal
Reverse
None of the above
31
Competition Act, 2002, National Company Law Tribunal Rules, 2016, Income Tax Act, 1961 is
which as
p
ect of mer
g
er?
legal
Technical Fundamental
None of the above
32
Amalgamation in the nature of merger, Amalgamation in the nature of purchase is under which
as
p
ects of mer
g
er
?
accounting
auditing costing
None of the above
33
Credit Facilities, Cost Reduction is under which aspects of merger?
Political
financial
Social
None of the above
34
Scientific Research : Section 35, Treatment of Preliminary Expenses : Section 35D(5) is under
which as
p
ects of mer
g
er?
amalgamation
taxation
acquisition
None of the above
35
Which merger involves a transaction in which two organisations having business operations in
different countries a
g
ree to inte
g
rate?
productextention Markerextention
cross border
None of the above
36
When a company splits off its existing business activities into several components, with the intent to
form a new com
p
an
y
that o
p
erates on its own or sell or dissolve the unit so se
p
arated, it is called as
Merger Demerger Reverse Merger
None of the above
37
Under which merger and amalgamations, an existing company i.e. transferor company loses its
identit
y
and is dissolved without bein
g
wound u
p
?
Vertical subsidiary
Reverse
None of the above
38
Whereas when target company’s permission is sought for acquiring control over the company, such
takeover is which takeover and is termed as what?
rivery,acquistion
friendly, acquisition
rivery,liquidition
None of the above
39
Reverse Merger takes place when a healthy company merges with a which company? Financially Weak Financially Strong Merged Financially Moderate
40
What is called the fusion of two or more existing companies? Acquisition Takeover Bailout Merger
41
The company which is formed as a result of the merger is known as which company? Amalgamating Amalgamated Bailout Takeover
42
The Competition Act , 2002 regulates the various forms of business combinations through what? Reserve Bank of India SEBI Regulation
Competion
Commission of India. Companies Act
43
Which act contains several provisions that deal with the taxation of different categories of Mergers
and Acquisitions? Competion Act, 2002 SEBI Regulations, 2015 Companies Act, 2013 Income Tax Act, 1961
44
What is the effect of adequate transparency and disclosures on the risk of investors? Enhance Increased Minimised Averaged
45
Which Accounting Standard deals with Accounting for amalgamations? Accounting Standard 14 Accounting Standard 11
Accounting Standard
13
Accounting Standard
12
46
A company in one country can be acquired by an entity (another company) from other countries is
called as what? Inter Border Merger Intra Border Merger Poison Pill Merger Cross Border Merger
47
What is the meaning of disjoining or a separation of one or more units of a company to form a new
company independent from original one? Merger Takeover Demerger Amalgamation
48
What take place when a profit - making parent company merges into a loss - making subsidiary
company? Reverse Merger Takeover Amalgamation Demerger
49
The tax relief under section 72A will be avail if the amalgamation is between which entities? Sole proprietor Companies Partnership firm
Hindu Undevided
Family
50
Which take over is the takeover which is affected with the consent of target company's executives
and management? Compulsory Hostile Managed Friendly
51
when an acquirer company takeovers the control over the other company agaisnt the wishes of
targeted company's management considered as what ? Merger Friendly Takeover Hostile Takeover Acquisition
52
Which act deals with the power of a company to acquire shares of another company? Companies Act, 2013 Competition Act, 2002 SEBI Regulation Income Tax Act, 1961
53
Which type of takeovers are substantial acquisition of shares in a financialy weak company not
being a seek industrial company? Complete Partial Resistance Bailout
54
Attempts by target managers to defeat outstanding takeover proposals are overt forms of a takeover
defences are called as what? Takeover defences Hostile Takeover Bailout Takeover Ownership Structure
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55
when the target company attempts to purchase the shares of the raider company is known as which
Defence? Crown Jewel Golder parachutes Packman Poison Pill
56
The divestiture of major operating unit most coveted by the bidder- commonly known as which
strategy? Poison Pill Crown Jewel Packman Poison Pill
57
What includes actions that occur before a takeover offer is made which make the firm more
difficult to acquire? Acceptance No Acceptance
Acceptance and
Resistance Resistance
58
The defence mechanism being used is anti-takeover amendments to the company's articles of
association are known as what? Shark Repellents Packman Poison Pill Golder parachutes
59
What is the name of the process of reshuffling or reorganizing the financial structure, which
p
rimaril
y
com
p
rises of e
q
uit
y
ca
p
ital and debt ca
p
ital?
Financial Resrtucturing Debt Restructuring Equity Restructuring None of the above
60
What can be either from the assets side or the liabilities side of the balance sheet? Financial Resrtucturing Equity Restructuring Debt Restructuring None of the above
61
What is commonly used as a financial tool than compared to equity restructuring? Equity Restructuring Financial Resrtucturing Debt Restructuring None of the above
62
Reducing the cost of capital for healthy companies is which type of debt capital? Short term borrowings
Medium term
borrowin
g
s
Long term borrowings None of the above
63
Which types of short-term borrowings include inter-corporate deposits, clean bills and clean over
drafts?
Long term borrowings Short term borrowings
Medium term
borrowin
g
s
None of the above
64
What includes reshuffling of the shareholders capital and the reserves that are appearing in the
balance sheet?
Financial Resrtucturing Equity Restructuring Debt Restructuring None of the above
65
What mainly deals with the concept of capital reduction? Equity Restructuring Financial Resrtucturing Debt Restructuring None of the above
66
Which are the commercial loans raised by the eligible resident entities from recognized non-resident
entities?
Internal Commercial
borrowin
g
s
External Commercial
borrowin
g
s
Direct Commercial
borrowin
g
s
None of the above
67
State the term of foreign currency denominated ECB with the Minimum average maturity period of
3 or 5
y
ears?
Short Term Long Term Medium Term None of the above
68
name the foreign currency denominated ECB with the minimum average maturity of the period of
10
y
ears ?
Medium Term Short term Long Term None of the above
69
Which is a foreign currency denominated instrument which is tradable on the stock exchange
g
enerall
y
in Euro
p
e or U.S.A.?
Depository Receipts Depository payment Depository saving None of the above
70
Which is an acquisition of the company or the division of another company, financed with the
substantial
p
ortion of the borrowed funds?
Buy back of sahres Leverage buyouts Management buyout None of the above
71
Which is the method of financial engineering? Buy back of sahres Leverage buyouts Management buyout None of the above
72
What is used as a defense mechanism, in an environment where the threat of corporate takeovers
has become real?
Buyback of shares Management buyout Leverage buyouts None of the above
73
What can extinguish or reduce the liability on any of its shares in respect of the share capital not
p
aid-u
p
?
Reduction of shares Reduction of Expenses Reduction of Capital None of the above
74
Which type of growth is through enhanced customer base, higher sales, increased revenue, money,
material, machinery etc.? Organised Unorganised Systematic Strategic
75
Which type of growth provides an organization with an aim of achieving accelerated or increased
growth through mergers, amalgamations etc.? Organised Unorganised Systematic Strategic
76
Name the merger of business firms who are engaged into same line of business? Systematic Unorganised Horizontal Co-generic
77
Name the merger of business firms engaged in different stages of production in an industry? Horizontal Vertical Conglomerate Co-generic
78
Name the merger of business firms who are engaged in unrelated business? Horizontal Vertical Conglomerate Co-generic
79
The acquirer must have or needs to purchase more than How much % of the paid up equity capital
of the other company which the acquirer intended to overtake? 50 75 25 33.33
80
Which Authority has laid down the guidelines for takeovers in order to protect the interests of the
small investors? UTI RBI ROC SEBI
81
Which strategy involves a significant change in the financial structure of the business firm? Financial Restructuring Financial Planning Financial Management
Organisational
Restructuring
82
In stock swap mergers, or stock-for-stock mergers, the holders of the target company's stock receive
which kind of stock of acquiring company? Debentures Shares Deposits Stock
83
Which are commercial loans raised by eligible resident entities from recognized non-resident
entities and should conform to paremeters such as minimum maturity, permitted and non-permitted Treasury bills Commercial Bills
External Commercial
Borrowings(ECBs)
Foreign Institutional
Investment
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84
What do you mean by the reorganization of each and every aspect of the company’s functional area? Post merger integration
Post merger
reor
g
anization
Post merger aquisation None of the above
85
What requires high quality management?
Post merger
reor
g
anization
Post merger integration Post merger aquisation None of the above
86
What is the part of corporate restructuring leads to change in the structure of organisations? Demerger Merger Both A and B None of the above
87
What in case of post merger has to lead more favorable than that of pre-merger? Terms of management
Terms of Company
Polic
y
Terms of employment None of the above
88
Which is an important tool for successful merger? Communication Competition Rivery None of the above
89
Which process must involve a significant change in the management culture of the acquired
business?
Human Resource
Management Post-Merger Integration
General Management
Integration
General Management
Culture
90
What is sought with an aim of trying to control the products & services feed by the involved
businesses? Post-merger integration
Human Resource
Management
Product & Service
development Mergers & Acquisitions
91
Management involves the which type of action of resources? Utilisation Analysis Culture Integration
92
What determines the success or failure of merged company? Earning Net profit Capitalization
Return on Capital
Employed
93
Name the valuation criteria for measuring the success of post merged company? Financial value Market Value Book Value Fair Market Value
94
Which is an incredibly challenging process that senior executives are required to undertake in
parallel to managing their core business opeations?
Human Resource
Management Post-Merger Integration
General Management
Integration Cultural Integration
95
The earning performance of the merged company calculated against what? Return on Assets Return on Liabilities
Return on Share
capital Return on Equity
96
Under Section 72A of the Income Tax Act, 1961 carry forward and setting off of accumulated losses
and unabsorbed depreciation of the amalgamating company is allowed against which kind of profits Future Present Past Average
97
What do you mean by Disinvestment? Selling assets Buyout Buying assets None of the above
98
What do you mean by Special Compensation Agreements? Poison Pill White Knight Crown Jewels Golden Parachute
99
State what is Pac Man Defense? greenmail payment
targeted share
repurchase
p
revent hostile
takeover Counteroffer for bidder
100
LBO deals with which type of Finance for transaction? Debentures Equity Bonds Term loans
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