CAIIB Crash Course June 2025 ABM Quiz-3

26/05/2025

Table of Contents

CAIIB Crash Course June 2025 ABM Quiz-3

JAIIB CAIIB Course Quiz – June 2025: The CAIIB exam for June 2025, conducted by IIBF, is fast approaching. To support your preparation, we are providing regular MCQ-based quizzes specifically designed for the JAIIB CAIIB syllabus. These quizzes are structured module-wise and unit-wise to help you cover the entire syllabus systematically. Practicing these quizzes consistently will strengthen your concepts, improve accuracy, and increase your chances of clearing the exam on your first attempt.

Q.1. Which of the following statements is true for an infrastructure project?
(a) It has long gestation period
(b) The debt equity ratio is normally high for an infrastructure project.
(c) The implementation period is usually long
(d) All of the above

Q.2. Which of the following is a source for meeting working capital requirements?
(a) Suppliers Credit
(b) Bank Finance
(c) Advance payment to suppliers
(d) Both a and b

Q.3. The amount of term loan instalment is Rs 10000/- per month, monthly average interest on TL is Rs 6000/-. If the amount of depreciation is Rs 30000/- p.a and PAT (Profit after Tax) is Rs 270000/-. What would be the DSCR?
(a) 1.93
(b) 1.91
(c) 1.99
(d) 1.95

Q.4. Purpose of credit monitoring is ______________.
(a) To ensure end use of the funds by the borrower
(b) To detect any deterioration in the security charged to the bank
(c) To ascertain that the business continues to run on the projected lines
(d) All of the above

Q.5. Capital is Rs 180, Reserves Rs 20, term loan Rs 300, Bank cash credit Rs 500, trade creditors Rs 50, provisions Rs 50/-net fixed assets Rs 400, inventories Rs 125, cash Rs 50, Receivables Rs 125, goodwill Rs 50. What is current ratio?
(a) 1
(b) 1:2
(c) 2:1
(d) 3

Q.6. In balance sheet of M/s Anshu & Co, amount of total assets is Rs 20 lac , current liabilities Rs 8 lac and capital and reserves Rs 4 lac. What is the debt-equity ratio:
(a) 2:1
(b) 2:2
(c) 2:3
(d) 1:2

Q.7. A company has net worth of Rs 13 lac, term liabilities are Rs 17 lac. Fixed Assets worth Rs 26 lac and current assets are Rs 24 lac. There are no intangible assets or the noncurrent assets. Calculate its net working capital.
(a) 3 Lac
(b) 6 Lac
(c) 5 Lac
(d) 4 Lac

Q.8. ________________ statements do not speak appropriate about net working capital.
(a) The greater the amount of bank borrowing for financing current assets, the more would be the liquidity of the enterprise.
(b) The greater the amount of net working capital (NWC), the more would be the liquidity of the enterprise
(c) Both a and b
(d) None of these

Q.9. What is the value of Current Liabilities, Liquid Assets and Inventory of a company whose Current Assets is ₹ 5,00,000 and its Current Ratio is 2.5 : 1 and Quick Ratio is 1 : 1.
(a) 150000
(b) 500000
(c) 200000
(d) 300000

Q.10. Which of the following statements is correct regarding the regulatory functions of the Insolvency and Bankruptcy Board of India (IBBI)?
A. IBBI regulates only the process of insolvency and not the professionals involved.
B. IBBI is the authority for regulating valuers under the Companies Act, 2013.
C. Insolvency Professionals (IPs) can act as Interim Resolution Professional, Resolution Professional, liquidator, or bankruptcy trustee.
D. Information Utilities are not under the purview of IBBI.

Q.11. Which of the following statements regarding the Committee of Creditors (CoC) under the Insolvency and Bankruptcy Code (IBC) is correct?
A. Operational creditors have equal voting rights as financial creditors in the CoC.
B. A resolution to withdraw the insolvency application under Section 12A requires 66% majority in the CoC.
C. The CoC is constituted by the Resolution Professional and includes all creditors.
D. In the absence of financial creditors, operational creditors can be part of the CoC with voting rights

Q.12. Which of the following pairs of adjudicating authority and the type of entity it deals with under the Insolvency and Bankruptcy Code (IBC) is correctly matched?
A. NCLT – Insolvency of individuals and sole proprietorships
B. DRT – Insolvency of Companies and LLPs
C. NCLAT – Appellate authority for orders passed by NCLT
D. DRAT – Appellate authority for corporate insolvency cases

Q.13. Which of the following statements regarding the formation and functioning of the Committee of Creditors (CoC) under the IBC is correct?
A. CoC must be formed within 7 days of initiation of CIRP by NCLT.
B. If there are no unrelated financial creditors, CoC consists of top 10 operational creditors only.
C. Appointment of a Resolution Professional (RP) in place of the Interim RP requires 75% voting in CoC.
D. Valuation reports by valuers can be shared with CoC members only upon signing a Non-Disclosure Agreement (NDA).

Q.14. What does the Information Memorandum (IM), prepared by the Resolution Professional (RP) during the Corporate Insolvency Resolution Process (CIRP), not typically include?
A. Audited financial statements of the Corporate Debtor (CD) for the last two financial years
B. Details of security interest held by creditors on admitted claims
C. Market valuation report of the CD’s brand and goodwill by an independent valuer
D. Particulars of debt owed to or by related parties of the CD

Q.15. As per IBC provisions during the liquidation process, how many secured financial creditors (who have relinquished their security interest under Section 52) can be included in the Stakeholders’ Consultation Committee, if their admitted claims are at least 50% of the liquidation value?
(a) Maximum of 1 creditor
(b) Maximum of 2 creditors
(c) Maximum of 3 creditors
(d) Maximum of 4 creditors

Q.16. Under the Pre-Packaged Insolvency Resolution Process (PIRP), what is the maximum time limit for submitting the resolution plan to the adjudicating authority after commencement, provided it is approved by the CoC?
(a) 60 days
(b) 90 days
(c) 120 days
(d) 180 days

Q.17. Which of the following correctly distinguishes PIRP from CIRP under the Insolvency and Bankruptcy Code?
A. PIRP can be initiated by any financial or operational creditor, while CIRP can only be initiated by the corporate debtor.
B. CIRP is restricted to MSMEs only, while PIRP is open to all corporate debtors.
C. PIRP has a maximum resolution period of 120 days with no extension, whereas CIRP allows up to 330 days including extensions.
D. Both PIRP and CIRP require approval from unrelated financial creditors before initiation.

Q.18. Under the Insolvency and Bankruptcy Code (IBC), which of the following statements is correct regarding termination or withdrawal of insolvency processes?
A. CIRP can be withdrawn at any time with 66% CoC vote under Section 12A.
B. PIRP requires 90% CoC vote to terminate the process.
C. PIRP can be terminated with at least 66% vote of the CoC, while CIRP requires 90% CoC vote under Section 12A.
D. Both CIRP and PIRP require unanimous CoC consent for termination

Q.19. As per RBI norms, which of the following statements regarding asset classification and provisioning by banks is correct?
A. Doubtful assets are loans that have remained in the sub-standard category for more than 90 days.
B. Provisioning Coverage Ratio (PCR) is the ratio of net NPAs to gross advances.
C. Loss assets are those where the bank or RBI has identified the asset as irrecoverable, though it may not be fully written off.
D. Standard assets require no provisioning at all under RBI norms.

Q.20. According to RBI and IIBF guidelines, which of the following best defines “siphoning of funds” in a bank lending context?
A. When a borrower defaults due to business losses despite proper fund utilization.
B. When borrowed funds are used for a related party transaction with board approval.
C. When borrowed funds are diverted for purposes unrelated to the borrower’s business, adversely affecting the entity or the lender.
D. When funds are invested in low-yield instruments approved by the company’s board.

Answer:

Q1: D
Q2: D
Q3: A
Q4: D
Q5: B
Q6: A
Q7: D
Q8: A
Q9: D
Q10: C
Q11: D
Q12: C
Q13: D
Q14: C
Q15: D
Q16: B
Q17: C
Q18: C
Q19: C
Q20: C