TEST UR KNOWLEDGE - SERIES

Transcription

1 TEST UR KNOWLEDGE - SERIES 2 66 (FIRST QS). Collection period of receivables is expressed with reference to a. cost of sales b. cost of productions c. sale d. NOA (none of above ) CORRECT ANSWER: C SALE 67. In creating mortgage the mortgagor transfers his/her/their on the moveable property. a. ownership b. possession c. some interest d. all the above CORRECT ANSWER: C SOME INTEREST 68. Loans are not sanctioned against the security of partly paid shares because it contravenes the provisions of a. Banking Regulation Act b. Reserve Bank of India act c. Security contract and regulation act d. RBI directives CORRECT ANSWER: d RBI directives 69. Net worth does not consist of a. Preference shares b. Share premium account c. Capital redemption reserve d. NOA CORRECT ANSWER: d NOA 70. Current ratio of a concern is 1, its net working capital will be a. positive b. negative c. NIL d. cannot be calculated CORRECT ANSWER: C NIL 71. Paripassu charge means a. Floating charge b. Charge which enjoys priority c. Charge in favour of several creditor with equal priority d. None of the above (NOA) CORRECT ANSWER: c Charge in favour of several creditor with equal priority 72. The period of Limitation in case of dishonoured foreign bill which is noted or protested will run from a. due date of the bill b. date of demand by the notary c. date of protest d. None of the above (NOA) CORRECT ANSWER: A DUE DATE OF THE BILL 73. Risk of legal or regulatory sanction, financial loss or reputation loss that a bank may suffer as a result of its failure to comply with any or all of the applicable laws, Regulations etc. is called as: a) Transaction risk b) Compliance risk c) Legal risk d) Systems risk CORRECT ANSWER: B COMPLIANCE RISK

2 74. The following is not a source of a fund a. Depreciation b. sale of a assets c. issue of bonus shares d. NOA CORRECT ANSWER: C ISSUE OF BONUS SHARES 75. At Breakeven point, contribution is.the fixed cost a. less than b. more than c. equal to d. NOA CORRECT ANSWER: C EQUAL TO 76. Regulations of Union Bank Officer Employees (Discipline and Appeal) Regulations 1976 do not stipulate the following as penalty. withholding of one or more increments of any officer on account of his/her failure to pass a prescribed departmental test/examination in accordance with the terms of appointment to the post which S/he holds a. True b. False CORRECT ANSWER: a. TRUE AS PER REGULATION Normally a bill of lading is treated as stale when it is presented to bank days after its date of issue. a. 30 b. 17 c. 25 d. 21 e. NOA CORRECT ANSWER: D 21 DAYS 78. ln a financial market, bond prices and yields are a) Inversely related b) Directly related, c) Inversely or directly related depending on type of bond d) NOA CORRECT ANSWER: a Inversely related 79. The formula of Capital Gearing Ratio is Fixed charge bearing Long Term Fund / Total Short term Fund a. True b. False Answer: b. False Fixed charge bearing Long Term Fund / Total Long term Fund 80. Right to Information Act 2005 came into force in all the states and Union Territories of India wef October 12, 2005 a. True b. False Correct Answer: b False enforceable in all the states and Union Territories of India EXCEPT Jammu and Kashmir 81. Where there is no security and suit is to be filed u/s 37 of CPC on the basis of negotiable instruments, such suit is called as a. Mortgage suit b. Summary suit c. Money suit d. Title suit CORRECT ANSWER: b. Summary suit

3 82. Find out the fixed cost of a unit whose BEP is Rs 3 lacs and P/V ratio is 30%. a. Rs 9 lacs b. Rs 10 lacs c. Rs 2.1 lacs d. Rs 0.90 lacs ANSWER: D RS 0.90 LACS 83. As per Union Bank Officer Employees (CONDUCT) Regulations 1976, the officer employee may accept gifts from his near relatives on occasions of social or religious functions and making such gifts is in conformity with the prevailing religious or social practices but s/he shall make a report to the Competent Authority if the value of the gifts exceeds: a. Rs 75 b. Rs 200 c. Rs 400 d. Rs 500 e. Rs 1000 CORRECT ANSWER: Rs 500 as per Regulation 14 (2) 84. Average Sundry creditors outstanding is Rs 0.50 lacs out of which Rs 0.10 lacs represent Non trade credit, annual purchase is Rs 9.60 lacs. Period of credit enjoyed is; a. 1.5 months b. ½ months c. 2 months d. NOA CORRECT ANSWER: B ½ MONTHS 85. For filing suit in Government accounts/ Government guaranteed accounts, minimum period (months) of notice u/s 80 CPC is essential. a. 1 month b. 2 months c. 3 months d. 5 months CORRECT ANSWER: B. 2 MONTHS 86. As per recovery policy 2016, the following instances shall not be treated as deviation in case of compromise settlement namely: Payment of settlement amount in instalments over a period of more than 2 years. a. True b. False CORRECT ANSWER: FALSE 87. Financial Risk is defined as a) Uncertainties in cash flow b) Variations in net cash flow c) Uncertainties resulting in outright losses d) Uncertainties resulting in adverse variation of profitability e) Both (c) & (d) CORRECT ANSWER: e) Both (c) & (d) 88. XYZ & Co, a partnership firm is maintaining a current account with your branch with operational instructions to be operated by any one of the partners'. A cheque signed by A is countermanded by B which he claims was, through an oversight at a later stage. Subsequently, the said partner approaches the bank to revoke the instructions of lifting the stop payment. The bank would... a. accept even if signed by him alone b. accept if signed by all the partners c. not accept the request d. accept by having indemnity from A CORRECT ANSWER- B ACCEPT IF SIGNED BY ALL THE PARTNERS

4 89. Who among the following will sign the account opening form for opening a current account in case of a partnership firm where the firm has three partners and a minor, aged 17, has been admitted to the firm for benefits? a. all the three and the father of the minor b. all the three and natural guardian of the minor c. all the three and the minor himself d. all the three partners only CORRECT ANSWER: D ALL THE THREE PARTNERS ONLY 90. A company has a networth of Rs.5 lacs. Term liability Rs.10 lacs, Fixed Asset of Rs.16 lacs and Current Asset Rs. 25 lacs. There is no intangible asset or ONCA. It's net working capital is a. Rs. 10 lakhs b. Rs. 1 lakh c. Rs. 9 lakh d. Rs. (-) 1 lakh CORRECT ANSWER: D. RS. (-) 1 LAKH 91. The Karta of HUF cannot do which of the following, in relation to business of the family a. can borrow money b. can sign documents c. can create charge on properties d. can deal with HUF property for benefit of the HUF e. none of the above CORRECT ANSWER: E. NONE OF THE ABOVE 92. What is the limitation period for Demand loan: a. 3 years from date of documents b. 3 years from date of demand c. 3 years from date of default after demand d. any of the above e. b and c whichever is earlier CORRECT ANSWER: a - 3 YEARS FROM DATE OF DOCUMENTS 93. As per Bank s policy in vogue, If an advance account had been standard and performing for a period of 3 years or more from the date of original sanction, then the lapses in sanction by way of enhancement or otherwise, monitoring, supervision has to be examined only, for the purpose of examination of staff accountability, for a period going back by three years from the date of NPA a. TRUE b. FALSE CORRECT ANSWER: b. FALSE. Correct answer as per Recovery policy 2016 is As per Bank s policy..for a period going back by two years from the date of NPA 94. When a bank is unable to conclude a large transaction in a particular instrument near the current market price, it is called as a) Market risk b) Market Liquidity risk c) Default risk d) counter party risk CORRECT ANSWER: B MARKET LIQUIDITY RISK 95. Indian Banks' Association (IBA) was the first to set up a SPNS or SWADHAN network of ATMs of its member banks in Mumbai. EXPAND SPNS? a) switch payment network system b) shared payment network switch c) shared payment network system d) shared payment network switch CORRECT ANSWER: C) SHARED PAYMENT NETWORK SYSTEM

5 96. In respect of a loan against lic policy, which of the following value is taken as the basis for fixation of the loan limit: A. Face value of the policy B. Net asset value of the policy C. Maturity value of the policy D. Surrender value of the policy E. Any of the above whichever is the lower CORRECT ANSWER: D. SURRENDER VALUE OF THE POLICY 97. Security features available with smart cards are? (a) multiple pins (b) retinal pattern verification (c) dynamic signature verification (d) vein recognition (e) all of above.. CORREVT ANSWER: (E) ALL OF ABOVE 98. A Cheque Truncation is defined by the new of Negotiable Instruments Act? a) Section 6(b) b) Section 16(b) c) Section 26(b) d) Section 36(b) CORRECT ANSWER: a) Section 6(b) 99. A small enterprise is an enterprise where the investment in plant and machinery is more than Rs. but does not exceed Rs.? a) 10 lakh & 1 crore b) 25 lakh & 1 crore c) 50 lakh & 2 crore d) 25 lakh & 5 crore e) 50 Lakh & 5 crore CORRECT ANSWER: d) 25 lakh & 5 crore 100. For smart cards, defines the physical features and the communication protocols? a) ISO 6816 b) ISO 7816 c) ISO 8816 d) ISO 9816 CORRECT ANSWER: b) ISO As per bank s policy, thresh hold limit for classifying LOANS AGAINST GOLD/ SILVER JEWELLERY FOR AGRICULTURE as Priority sector Advance is a. 05 lacs b. 10 lacs c. 15 lacs d. 20 lacs CORRECT ANSWER: D 20 LACS AS PER MANAGEMENT OF CREDIT POTFOLIO LOAN POLICY DATED An HUF concern wants to become partner of a firm in which there are already 15 partners. The no. of HUF members is 7. Which of the following is applicable in this case: a. Since no. of partners would exceed 20 partnership is not possible b. HUF will be taken as one member. Hence partnership is possible c. HUF cannot become a partner in a partnership firm d. None of the above CORRECT ANSWER: c HUF cannot become a partner in a partnership firm

6 103. In order to facilitate inter-operability among the clusters of ATM networks at the national level, the IDRBT has initiated the process of setting up a NFS to facilitate apex level connectivity of other switches established by banks. EXPAND NFS? a) Networking Financial Switch b) Networking Financial System c) National Financial Switch d) National Financial System CORRECT ANSWER: c) National Financial Switch 104. Your branch is having a partnership current account & a garnishee order in the name of a partner in firm, is received. It will: a. Apply to all partners. b. Apply to firm s account. c. Not apply to firm s account. d. Not apply to any one. e. a and c. CORRECT ANSWER: C. NOT APPLY TO FIRM S ACCOUNT Opening stock of raw material is Rs.30 lacs, closing stock is Rs.50 lacs. Annual purchase is Rs.500 lacs. What is the average period of holding of Raw Materials? a. 2 M b. 1.5 M c. 1 M d. NOA CORRECT ANSWER: C 1 M 106. Balance as per Cash Book on ,000, Cheques sent to bank but not entered in cashbook - 2,200, Cheques issued and presented on 7th April - 3,000 Bill payable by Bank not entered in the cash book - 1,600, Balance as per pass book will be... a. 19,200 b. 23,600 c. 20,800 d. 6,400 CORRECT ANSWER: b Rs 23, B drew a bill of 10,000 for 2 months on A for mutual accommodation. It was decided that the proceeds would be shared equally. How much amount would be received by A if the bill was p.a.? a. 9,800 b. 5,000 c. 5,100 d. 4,900 CORRECT ANSWER: D RS 4, Given, Currency with public - Rs Crores, Demand deposit with banking system - Rs Crores Time deposits with banking system - Rs Crores, Other deposit with RBI - Rs Crores Savings deposit of post office savings banks - Rs Crores All deposit with post office savings bank excluding NSCs - Rs Crores Calculate M1. a. Rs Crores b. Rs Crores c. Rs Crores d. Rs Crores CORRECT ANSER: C Rs Crores Solution: M1 = currency with public + demand deposit with the banking system + other deposits with RBI M1 = M1 =

7 109. Given, Currency with public - Rs Crores Demand deposit with banking system - Rs Crores Time deposits with banking system - Rs Crores Other deposit with RBI - Rs Crores Savings deposit of post office savings banks - Rs Crores All deposit with post office savings bank excluding NSCs - Rs Crores Calculate M2. a. Rs Crores b. Rs Crores c. Rs Crores d. Rs Crores CORRECT ANSER: C Rs Crores Solution: M2 = M1+Savings deposit of post office savings banks So, M2 = M2 = Crores 110. Given, Currency with public - Rs Crores Demand deposit with banking system - Rs Crores Time deposits with banking system - Rs Crores Other deposit with RBI - Rs Crores Savings deposit of post office savings banks - Rs Crores All deposit with post office savings bank excluding NSCs - Rs Crores Calculate broad money M3. a. Rs Crores b. Rs Crores c. Rs Crores d. Rs Crores CORRECT ANSWER: D RS CRORES Solution: M3 = M1+Time deposit with banking system So, M3 = M3 = Crores 111. Financial leverage means a. Use leveraged lease to plan tax liability b. High degree of solvency c. Low bank finance d. Use of more debt capital to increase profit Correct answer: D Use of more debt capital to increase profit 112. An expenditure on advertisement for furtherance of market for products is not an example of... (i) revenue expenditure, (ii) capital expenditure, (iii) deferred revenue expenditure a. Only (i) and (ii) b. Only (i) and (iii) c. Only (ii) and (iii) d. (i), (ii) and (iii) CORRECT ANSWER: a Only (i) and (ii)

8 113. Where does an auditor of a cooperative society submit the audit report? a. To the managing committee of the society only b. To the Registrar of Cooperative Societies of the State concerned only c. To the State Assembly concerned d. To the Registrar of Cooperative Societies of the State concerned and a copy to the society CORRECT ANSWER: b To the Registrar of Cooperative Societies of the State concerned only 114. Valuation of stocks is done by a business firm at cost price or market price, whichever is lower basis, under... a. Convention of Full Disclosure b. Convention of Materiality c. Convention of Conservatism d. Convection of Consistency CORRECT ANSWER: C Convention of Conservatism 115. Which of these is not a special purpose journal? a. Cash journal b. Purchase journal c. Debtors journal d. Sales journal CORRECT ANSWER: C DEBTORS JOURNAL 116. Which of these is not an essential feature of a bill of exchange? a. Unconditional b. Certainty of amount c. In writing d. Amount to be paid in foreign currency CORRECT ANSWER: D AMOUNT TO BE PAID IN FOREIGN CURRENCY 117. Mr. X wants to receive a fixed amount for 15 years by investing Rs. 9 9% ROI. How much he will receive annually? a b c d CORRECT ANSWER: c Solution: P = 9 lac R = 9% p.a. (Note: SINCE HERE PAYMENT IS TO BE RECEIVED ANNUALY, NOT Monthly, Rate IS NOT divided by 12) T = 15 yrs (Note: SINCE HERE PAYMENT IS TO BE RECEIVED ANNUALY, NOT Monthly, Time IS NOT multiplied with 12) So, we can well use EMI formula in this question. The formula of EMI = P * R * (1 + R)^T { (1 + R)^T - 1 } So, EMI = * 0.09 * 1.09^15 (1.09^15 1) = Ans 118. Which of the following is/are correct? (i) Net present value (NPV) is one of the two or three most important concepts in finance, (ii) NPV is the difference between the market value of an investment and its cost, (iii) The financial manager acts in the shareholders' best interests by identifying and taking positive NPV projects a. Only (i) and (ii) b. Only (i) and (iii) c. Only (ii) and (iii) d. (i), (ii) and (iii) CORRECT ANSWER: D (I), (II) AND (III)

9 119. Which of the following is/are function/s of the interbank operations of the foreign exchange market? (i) Provides a bank with a continuous stream of information on conditions in the foreign exchange market, (ii) Provides a bank with technological resources for use in foreign exchange trading, (iii) Permits a bank to take on a position in a foreign currency quickly a. Only (i) and (ii) b. Only (i) and (iii) c. Only (ii) and (iii) d. (i), (ii) and (iii) CORRECT ANSWER: b Only (i) and (iii) 120. Under a floating exchange rate system a fall in the market price (the exchange rate value) of a currency is called a(n)... of that currency. a. appreciation b. depreciation c. revaluation d. devaluation CORRECT ANSWER: B DEPRECIATION 121. What annual rate of simple interest was paid if Rs. 500 earned Rs. 55 as interest in 2 Years and 9 months? a. 2% b. 3% c. 3.5% d. 4% CORRECT ANSWER: d 4% 122. Risk of a Capital budgeting can be incorporated by... (i) Adjusting the Cash flows, (ii) Adjusting the Discount Rate, (iii) Adjusting the life a. Only (i) and (ii) b. Only (i) and (iii) c. Only (ii) and (iii) d. (i), (ii) and (iii) CORRECT ANSWER: d (i), (ii) and (iii) 123. Savings in respect of a cost is treated in capital budgeting as... (i) An Inflow, (ii) An Outflow a. Only (i) b. Only (ii) c. Either (i) or (ii) d. Neither (i) not (ii) CORRECT ANSWER: A ONLY (I) 124. A draws a bill on B for 4,500 for mutual accommodation in the ratio 2:1. A got it discounted at 4,230 and remitted 1/3rd of the proceeds to B. At the time of maturity, how much amount A should remit to B such that B can pay off the bill? a. 3,000 b. 2,880 c. 2,920 d. 3,010 CORRECT ANSWER: A 3,000

10 125. Profit is a liability for a firm and the loss is an asset under which of the following concepts... a. Business Entity Concept b. Materiality Concept c. Historical Record Concept d. Accounting Period Concept CORRECT ANSWER: A BUSINESS ENTITY CONCEPT 126. As per Bank s policy in vogue, one of the following does not fall under the eligible financial collateral. a. Kisan Vikas Patra dated b.term deposits dated issued by the bank (Lender) c. State Government Securities dated d. Unrated Debt Securities issued on CORRECT ANSWER: A. KISAN VIKAS PATRA DATED (SINCE ISSUE DISCONTINUED WEF so this instrument will be forged one) AS PER CREDIT RISK MITIGATION TECHNIQUES AND COLLATERAL MANAGEMENT (point no of page no. 43). UNRATED DEBT SECURITIES IS A VALID SECURITY A Branch Head of SCALE IV has sanctioned a working capital limit to Z (proprietary concern). Working Capital limit of Z is in CR 1. Mr Z is also the director of ABC company & also had a role in day to day affairs of ABC company. Subsequently Z resigned from the board of the Company. ABC enjoying certain financial limit from another bank. ABC s name appears in RBI s defaulter list but as per Banker s report, the conduct and operation of the ABC company are otherwise satisfactory. In the given scenario, Branch Head sanctioned and disbursed an ADHOC in working capital limit of Z. Subsequently, Auditors pointed out that said ADHOC limit is in violation of one of the clause of a policy. Auditor s remark is; a. Correct b. Wrong CORRECT ANSWER: A. CORRECT AS PER MANAGEMENT OF CREDIT PORTFOLIO LOAN POLICY DATED (point 11.1 of page 81) In case of cross border collaterals/ guarantees, it is not mandatory to comply with relevant exchange control regulations. Statement is; a. True b. False CORRECT ANSWER: B. False (As per credit risk mitigation techniques and collateral management point 5.6 of page no 11) A LIC policy has been accepted as an exclusive Financial Collateral Security to secure an advance given to Z. Assured is Z. The policy was taken on with 10 years term. Loan was sanctioned on with a repayment period of 5 years inclusive of moratorium period of six months. Whether, this exclusive Financial collateral security is an acceptable valid financial security. a. Yes b. No CORRECT ANSWER: B. NO (as per credit risk mitigation techniques and collateral management it is mandatory that repayment period of TL should not exceed the term of policy or in other words, maximum period of loan should not exceed the remaining period of the security (point no of page 45). CHECK THE LEFT-OVER PERIOD OF TERM OF POLICY AND REPAYMENT PERIOD) Which one of the following does not come under low priority areas of lending as per bank policy a. Vegetable oil and Vanaspathi sector b. Paints and varnishes c. Refratories d. Airline Services e. Telecom cables CORRECT ANSWER: B. AS PER MANAGEMENT OF CREDIT PORTFOLIO LOAN POLICY DATED (point and 3.1 of page 13 and 14).

11 131. A Branch Head has taken a LIC POLICY standing in the names of X and Y (HOLDERS and friends of Z) as Financial Collateral Security to secure an advance given to Z. Branch Head executed all necessary documents from X and Y besides discharge of policy (assignments) by the Assured in favour of the bank and also obtained the signature of Z on Assignment. Subsequently, Auditors pointed out that obtention of said collateral is in violation of policy guidelines. Branch Head in his reply to Auditor s report submitted that there is no violation. Branch Head s rely is; a. Correct b. Wrong CORRECT ANSWER: B. WRONG {as per credit risk mitigation techniques and collateral management since z do not have insurable interest in the life of assured x and y being his friends only (point no of page 45)} 132. A credit limit enjoyed by a borrower is 11 crores. Bank has sanctioned a cash credit limit of 7 crores and Working Capital Demand Loan of 4 crores. Subsequently, it is pointed out by higher authority that segmentation of total sanctioned limit is not correct. Find out the error where it exists in the following bifurcation as done by the sanctioning authority; a. 7 crores and b. 4 crores i. a only ii. b only iii.a and b iv.none of above CORRECT ANSWER: iii since normally WCDL shall be 80% and working capital limit at 20% of the assessed limit (as per management of credit portfolio loan policy dated point of page 29 & 30) A. Mrs A is enjoying a Housing loan facility from a bank. Limit is Rs 2.5 crores and present exposure is Rs 1 crore. Property say ABC owned by A, held as prime security against the said housing loan. C. Valuation Report reads that market value of this property ABC is Rs 10 crores and as per Govt s ceiling rate, value may be enhanced by 5%. D. Recent due diligence report of ABC undertaken by branch spells that 5% haircut on the market value reported by Valuer will be minimum in case of distress sale. E. Mrs A is also the proprietor of XYZ enterprises. XYZ is enjoying Cash credit limit of Rs 5 crores with present outstanding of Rs 2 crores from that bank. ABC is the existing collateral to secure this exposure. F. Mrs A now requests the bank to sanction a term loan of Rs 3 crores and offered ABC as collateral. G. On enquiry, it is gathered that Sales tax amounting to Rs 0.75 crores is due from proprietary concern XYZ on date. Furtherance, as per IT return of A, there is an arrear demand of 0.25 crores on date too. Both these issues are under litigation. WORKOUT THE LEGALLY PERFECTED FIRST CLAIM VALUE OF THAT PROPOSED COLLATERAL FOR THE REQUESTED TERM LOAN ON ACCEPTANCE DATE? CORRECT ANSWER: As per credit risk mitigation techniques and collateral management (point no of page 14), prudential approach to Cash Credit facility and Guidelines on Housing Finance, LEGALLY PERFECTED FIRST CLAIM VALUE FOR PROPOSED TERM LOAN will be as under: 1. Market value as per VR : Rs 10 Crores 2. Value as per Govt Ceiling rate (only reported in VR): Rs 10 Crores + 5% of MV = Crores 3. Distress Value (reported by branch): Rs 10 Crores (-) 5% of MV = 9.50 crores 4. Value to be considered= Value of 1, 2, and 3, whichever is lower = 9.50 Crores 5. Netting of CONSIDERED VALUE BY a. On account of Housing Loan = 200 % of limit or outstanding whichever is lower = 2 crores b. On account of Cash Credit Exposure = 100 % of limit or outstanding whichever is Higher = 5 crores c. On account of Statutory liabilities either of Proprietary concern and that of Proprietor (disputed or un disputed liability has the same value) = 1 crores d. THEREFORE, TOTAL NETTED AMOUNT = 8 crores 6. LEGALLY PERFECTED FIRST CLAIM VALUE on proposed term loan = 9.5 (-) 8 = Rs 1.5 crores.

12 134. A business magnet approached the bank for finance to enable his domestic company to go for acquisition of an overseas joint ventures in which that domestic company has equity participation. Whether bank should finance for the said purpose. a. Yes b. No CORRECT ANSWER: a. YES (as per management of credit portfolio loan policy dated point of page 53) Which one of the following do not fall under STABLE AREA of lending a. Plastic products b. Aluminium c. Carbon credit d. News print paper e. Media Production CORRECT ANSWER: D (as per management of credit portfolio loan policy dated point of page 14) 136. A existing borrower with a satisfactory track record and dealing approached the bank for an advance and offered the specially minted gold coins weighing 70 grams as security. Based on the category of security, what will be the decision of the Bank if the other parameters of the proposal are absolutely ok and accetable: a. Accepting the request of the Borrower b. Refusing the request of the Borrower CORRECT ANSWER: B (as per management of credit portfolio loan policy dated point of page 15) 137. Land ABC was purchased on by MR X. Mr X approached the bank for a finance against the security of this property on as collateral. Bank obtained the valuation report of ABC from an approved valuer on Bank also conducted due diligence of ABC next day of report s date. Following are the values of ABC as mentioned in VR and due diligence report. a. Market value: Rs 50 lacs b. Distress value: Rs 48 lacs c. As per registered Sale Deed: Rs 40 lacs d. As per Due Diligence report: Rs 48 lacs Which value, bank will consider? CORRECT ANSWER: c. As per registered Sale Deed: Rs 40 lacs {(As per credit risk mitigation techniques and collateral management (point no 7.4 of page 15)} 138. A risk is defined as when a third party delivered collateral assets are adversely corelated to borrowers credit performance/quality of assets itself, RISK is; a. Concentration risk b. correlation risk c. operational risk d. market risk e. legal risk CORRECT ANSWER: correlation risk {(As per credit risk mitigation techniques and collateral management (point no 2.5.1of page 25)} 139. Find the odd man out in the following thrust cum focussed areas of Agriculture advances as per policy in vogue. a. Finance amounting to 180 lacs to a food and agro processing unit. b. Finance amounting to 210 lacs to a farmer s producer organisation directly engaged in dairy. c. Aggregate loan of 40 lacs against ware housing receipt against pledge to farmers d. A finance of 30 lacs to Agri clinic e. A loan of 250 lacs to a poultry project CORRECT ANSWER: b. Finance amounting to 210 lacs to a farmer s producer organisation directly engaged in dairy since ceiling is 200 lacs (as per management of credit portfolio loan policy dated point of page 50 and 51).

13 140. On request of borrower, a credit facility of 100 lacs is to be transferred from X region to Y region of A zone. Said credit facility has been sanctioned by RLCC. The competent authority to approve the said transfer will be: a. RLCC b. ZLCC c. CAC II d. CAC I CORRECT ANSWER: b. ZLCC (as per management of credit portfolio loan policy dated point of page 50) As per present definition of Amended Technology Upgradation Fund Scheme, which one of loans sanctioned on following dates will come under this new scheme. a b c d CORRECT ANSWER: c (as per management of credit portfolio loan policy dated point of page 58). TEST UR KNOWLEDGE SERIES 2: SEVENTH ROUND: Googly 142. As per policy in vogue, advance cannot be granted against Certificate of Deposits issued by a mutual fund entity. a. True b. False CORRECT ANSWER: b. False (as per management of credit portfolio loan policy dated point of page 17). TEST UR KNOWLEDGE SERIES 2: SEVENTH ROUND: Googly 143. Sanctioning Authority i.e. Branch Head has been requested by a borrower to allow book debt upto 120 days for calculation of drawing power citing logical reason and ground. Who will be the permitting Authority? a. Branch Head b. RLCC c. ZLCC CORRECT ANSWER: b. RLCC (as per management of credit portfolio loan policy dated point of page 36). TEST UR KNOWLEDGE SERIES 2: SEVENTH ROUND: Googly 144. As per policy in vogue, IRR approach is to be used in case of term loan with repayment period of 5 years or more having a minimum ceiling of; a. 2.5 crores b. 5 crores c. 10 crores d. 15 crores e. 20 crores CORRECT ANSWER: c. 10 crores (as per management of credit portfolio loan policy dated point of page 29). TEST UR KNOWLEDGE SERIES 2: SEVENTH ROUND: Googly 145. Current Ratio is 4:1. Net working Capital is Rs What will be the current asset? a b c d CORRECT ANSWER: B ====================================================================