CBSE Class 12 Accountancy – Marking Scheme 2022 - 2023 - Download
Learning without understanding is not helps the students to attain the best scores in exams. For helping those enthusiastic students, who want to prove their best, our CBSE tips website helps by providing way to reach high scores. we are very proud to give you a lot of collections of CBSE Sample Question Papers and Marking Scheme in PDF format.
CBSE Class 12 Accountancy – Sample Question Papers and Answer Keys 2022-2023 - Download
Learning without understanding is not helps the students to attain the best scores in exams. For helping those enthusiastic students, who want to prove their best, our CBSE tips website helps by providing way to reach high scores. we are very proud to give you a lot of collections of CBSE Sample Question Papers and Answer Keys in PDF format.
Every year CBSE conducts board exams for 12th standard. These exams are very competitive to all the students. So our website provides online tests for all the 12th subjects. These tests are also very effective and useful for those who preparing for competitive exams like NEET, JEE, CA etc. It can boost their preparation level and confidence level by attempting these chapter wise online tests.
These online tests are based on latest CBSE Class 12 syllabus. While attempting these our students can identify the weak lessons and continuously practice those lessons for attaining high marks. It also helps to revise the NCERT textbooks thoroughly.
Question 1.
If net profit is 7 50,000 after writing off goodwill 7 10,000 then the cash flow from operating activities will be:
(a) ₹ 60,000
(b) ₹ 40,000
(c) ₹ 50,000
(d) ₹ 30,000
Answer: (a) ₹ 60,000
Question 2.
Which of the following is an example of Cash Flow from Operating Activities ?
(a) Purchase of Machinery
(b) Issue of Shares
(c) Purchases of Inventory for Cash
(d) Purchases of Investment
Answer: (c) Purchases of Inventory for Cash
Question 3.
Cash sales in :
(a) Operating Activity
(b) Investing Activity
(c) Financing Activity
(d) None of these
Answer: (a) Operating Activity
Question 4.
Issue of shares in consideration of purchase of plant and machinery results into :
(a) Inflow of Cash
(b) Outflow of Cash
(c) Neither Inflow nor Outflow
(d) None of these
Answer: (c) Neither Inflow nor Outflow
Question 5.
Decrease in Current Asset is……….in operating profit
(a) Subtracted
(b) Added
(c) Divided
(d) Multiplied
Answer: (b) Added
Question 6.
Cash from operating activities will decrease due to :
(a) Increase in Current Assets
(b) Decrease in Current Liabilities
(c) Neither of the two
(d) Both (a) and (b)
Answer: (d) Both (a) and (b)
Question 7.
While calculating operating profit which will be added to net profit:
(a) Interest received
(b) Profit on sale of Asset
(c) Increase in General Reserve
(d) Refund of Tax
Answer: (c) Increase in General Reserve
Question 8.
Preparation of cash flow statement is :
(a) Mendatory
(b) Recommendatory
(c) Required under the Companies Act
(d) None of these
Answer: (a) Mendatory
Question 9.
While calculating cash flow from operating netivities which will be deducted ?
(a) Increase in Creditors
(b) Increase in Debtors
(c) Decrease in Debtors
(d) Decrease in Prepaid Expenses
Answer: (b) Increase in Debtors
Question 10.
While calculating cash flow from operating activities, which will be added ?
(a) Increase in Stock
(b) Increase in Creditors
(c) Decrease in Bills Payable
(d) Increase in Debtors
Answer: (b) Increase in Creditors
Question 11.
An example of Cash Flows from Financing Activity is :
(a) Sale of goods
(b) Sale of Investment
(c) Cash receipts from issue of shares
(d) Interest received
Answer: (c) Cash receipts from issue of shares
Question 12.
How will you treat payment of ‘Interest of Debentures’ while preparing a Cash Flow Statement ?
(a) Cash Flow from Operating Activities
(b) Cash Flow from Investing Activities
(c) Cash Flow from Financing Activities
(d) Cash Equivalents
Answer: (c) Cash Flow from Financing Activities
Question 13.
Cash payment to employees is a Cash Flow from:
(a) Operating Activities
(b) Investing Activities
(c) Finance Activities
(d) All the above
Answer: (a) Operating Activities
Question 14.
Where will you show purchase of goodwill in Cash Flow Statement:
(a) Cash Flow from Operating Activities
(b) Cash Flow from Investing Activities
(c) Cash Flow from Financing Activities
(d) Cash Equivalent
Answer: (b) Cash Flow from Investing Activities
Question 15.
An example of Cash Flow from Investing Activities :
(a) Cash Sales
(b) Issue of Shares
(c) Payment of cash for purchase of machinery
(d) Payment of Dividend
Answer: (c) Payment of cash for purchase of machinery
Question 16.
Interest received by a finance company is classified under which kind of activity while preparing a Cash Flow Statement ?
(a) Cash Flow from Operating Activities
(b) Investing Activities
(c) Financing Activities
(d) Cash Equivalent
Answer: (a) Cash Flow from Operating Activities
Question 17.
Which of the following item is not considered as cash equivalents ?
(a) Bank Overdraft
(b) Commercial Papers
(c) Treasury Bills
(d) Investment
Answer: (d) Investment
Question 18.
Which of the following is not a Cash in Flow ?
(a) Sale of Fixed Asset
(b) Purchase of Fixed Asset
(c) Issue of Debentures
(d) Sale of Goods for Cash
Answer: (b) Purchase of Fixed Asset
Question 19.
In cash flow statement, the item of ‘Interest’ is shown in:
(a) Operating Activities
(b) Investing Activities
(c) Financial Activities
(d) In both (d) & (c)
Answer: (d) In both (d) & (c)
Question 20.
Which of the following is not a Cash Outflow:
(a) Increase in Creditors
(b) Increase in Debtors
(c) Increase in Stock
(d) Increase in prepaid expenses
Answer: (a) Increase in Creditors
Question 21.
If net profit is ₹ 35,000 after writing off good will ₹ 6,000 and loss on sale of furniture ₹ 1,000, cash flow from operating activities will be :
(a) ₹ 35,000
(b) ₹ 42,000
(c) ₹ 29,000
(d) ₹ 28,000
Answer: (b) ₹ 42,000
Question 22.
Income tax refund is a cash of:
(a) Source
(b) Application
(c) Both (a) & (b)
(d) None of these
Answer: (a) Source
Question 23.
Cash Flow Statement is prepared from:
(a) Balance Sheet
(b) Profit & Loss Account
(c) Additional Information
(d) All of these
Answer: (d) All of these
Question 24.
Cash Flow Statement in based upon:
(a) Cash basis of accounting
(b) Accrual basis of accounting
(c) (a) and (b) both
(d) None of these
Answer: (a) Cash basis of accounting
Question 25.
Which of the following is not a cash inflow ?
(a) Decrease in Debtors
(b) Issue of Debentures
(c) Decrease in Creditors
(d) None of these
Answer: (c) Decrease in Creditors
Question 26.
Cash from operation is equal to :
(a) Net Profit + Increase in Current Assets
(b) Net Profit + Decrease in Current Liabilities
(c) Operating Profit + Adjustment of Current Assets and Current Liabilities
(d) All of the above
Answer: (b) Net Profit + Decrease in Current Liabilities
Question 27.
Following Is included in Cash Flow from Operating Activities:
(a) Royalties, Fees, Commission
(b) Purchase of Debentures
(c) Purchase of Machinery
(d) issue of Shares
Answer: (a) Royalties, Fees, Commission
Question 28.
Cash Flow Statement is related to:
(a) AS-3
(b) AS-6
(c) AS-9
(d) AS-12
Answer: (b) AS-6
Question 29.
Which of the following item is considered as cash equivalents:
(a) Bank Overdraft
(b) Bills Receivable
(c) Debtors
(d) Short-term Investment
Answer: (a) Bank Overdraft
Question 30.
Which calculating cash flow from operating activities which is added net profit ?
(a) Increase in Stock
(b) Decrease in Stock
(c) Increase in Debtors
(d) Decrease in Creditors
Answer: (b) Decrease in Stock
Question 31.
Following are included in cash equivalent:
(a) Treasury Bill
(b) Trade Bill
(c) Bank Deposits of Short Maturity Period
(d) All of above
Answer: (d) All of above
Question 32.
Which activity comes under ‘Operating Activities’ ?
(a) Purchase of Land
(b) Issue of Debentures
(c) Proceeds from Issuance of Equity Shares
(d) Cash Sales
Answer: (d) Cash Sales
Question 33.
While calculating profit from operating activities, which will be added back to net profit:
(a) Goodwill Written off
(b) Depreciation
(c) Loss oh Sale of Fixed Assets
(d) All the Above
Answer: (d) All the Above
Question 34.
Which one of following is not a non-cash item ?
(a) Cash Sales
(b) Goodwill written off
(c) Depreciation
(d) Provision of Bad Debts
Answer: (a) Cash Sales
Question 35.
Claims received from Insurance Companies are treated as:
(a) Cash Flow from Operating Activities
(b) Cash Flow from Investing Activities
(c) Cash Flow from Financing Activities
(d) None of these
Answer: (a) Cash Flow from Operating Activities
Question 36.
Cash flow statement according to AS-3 is mandatory to:
(a) All enterprises
(b) Companies listed on a stock exchange
(c) Enterprises having turnover expending 50 Rs crore
(d) (b) & (c) both
Answer: (d) (b) & (c) both
Question 37.
Following are true about cash equivalent:
(a) More Liquid Short-term Investment
(b) Minimum risk
(c) Maturity of 3 months or less than 3 months
(d) All the above
Answer: (d) All the above
Question 38.
Which of the following is not the source of Cash ?
(a) Purchase of Fixed Assets
(b) Funds from Operations
(c) Issue of Debentures
(d) Sale of Fixed Assets
Answer: (a) Purchase of Fixed Assets
Question 39.
Which of the following activity comes under Financial Activities ?
(a) Receipts from issurence of Equity Shares
(b) Cash Sales
(c) Bank Overdraft
(d) Purchase of Debentures
Answer: (a) Receipts from issurence of Equity Shares
Question 40.
An analysis of cash flow is useful for..—.planning.
(a) Short-term
(b) Long-term
(c) Medium-term
(d) Very Long-period
Answer: (a) Short-term
Every year CBSE conducts board exams for 12th standard. These exams are very competitive to all the students. So our website provides online tests for all the 12th subjects. These tests are also very effective and useful for those who preparing for competitive exams like NEET, JEE, CA etc. It can boost their preparation level and confidence level by attempting these chapter wise online tests.
These online tests are based on latest CBSE Class 12 syllabus. While attempting these our students can identify the weak lessons and continuously practice those lessons for attaining high marks. It also helps to revise the NCERT textbooks thoroughly.
Question 1.
The gross profit ratio is the ratio of gross profit to :
(a) Net Cash Sales
(b) Net Credit Sales
(c) Closing Stock
(d) Net Total Sales
Answer: (d) Net Total Sales
Question 2.
Which one of the following ratios is most important in determining the long-term solvency of a company ?
(a) Profitability Ratio
(b) Debt-Equity Ratio
(c) Stock Turnover Ratio
(d) Current Ratio
Answer: (b) Debt-Equity Ratio
Question 3.
Liquidity Ratio:
Answer: (c)
Question 4.
The ratios are primarily measures of earning capacity of the business.
(a) Liquidity
(b) Activity
(c) Debt
(d) Profitability
Answer: (d) Profitability
Question 5.
Total Assets ₹ 8,10,000
Total Liabilities ₹ 2,60,000
Current Liabilities ₹ 40,000
Debt-equity ratio is:
(a) 0.05 : 1
(b) 0.4 : 1
(c) 2.5 : 1
(d) 4 : 1
Answer: (c) 2.5 : 1
Question 6.
Total Assets ₹ 7,70,000
Total Liabilities ₹ 2,60,000
Current Liabilities ₹ 40,000
Total Assets to Debt Ratio is:
(a) 3.5 : 1
(b) 2.56 : 1
(c) 2.8 : 1
(d) 3 : 1
Answer: (a) 3.5 : 1
Question 7.
Operating Ratio is:
(a) Profitability Ratio
(b) Activity Ratio
(c) Solvency Ratio
(d) None of these
Answer: (a) Profitability Ratio
Question 8.
The formula for ascertaining Total Assets to Debt Ratio is:
Answer: (a)
Question 9.
Which of the following is an operating’ income ?
(a) Sale of Merchandise
(b) Interest Income
(c) Dividend Income
(d) Profit on the sale of old car
Answer: (a) Sale of Merchandise
Question 10.
Which of the following non-operating expense?
(a) Rent
(b) Selling Expenses
(c) Wages
(d) Loss on Sale of Machinery
Answer: (d) Loss on Sale of Machinery
Question 11.
Current Ratio includes:
(a) Stock
(b) Debtors
(c) Cash
(d) All of these
Answer: (c) Cash
Question 12.
Proprietory ratio is calculated by the following formula:
Answer: (c)
Question 13.
The following groups of ratios primarily measure risk
(a) Liquidity, activity and profitability
(b) Liquidity, activity and common stock
(c) Liquidity, activity and debt
(d) Activity, debt and profitability
Answer: (d) Activity, debt and profitability
Question 14.
To know the return on investment, by capital employed we mean:
(a) Net Fixed Assets
(b) Current Asset-Current Liabilities
(c) Gross Block
(d) Fixed Assets + Current Assets-Current Liabilities
Answer: (d) Fixed Assets + Current Assets-Current Liabilities
Question 15.
The term fixed assets include :
(a) Cash
(b) Machinery
(c) Debtors
(d) Prepaid Expenses
Answer: (b) Machinery
Question 16.
If sales is 7 4,20,000 sales returns is 7 20,000 and cost of goods sold 7 3,20,000 gross profit ratio will be :
(a) 20%
(b) 25%
(c) 15%
(d) 10%
Answer: (a) 20%
Question 17.
Ratio based on figures of profit & loss as well a the Balance sheet are:
(a) Profitability Ratios
(b) Operation Ratio
(c) Liquidity Ratio
(d) Composite Ratio
Answer: (d) Composite Ratio
Question 18.
Equity share capital ₹ 15,00,000
Reserve and Surplus ₹ 7,50,000
Total Assets ₹ 45,00,000
Properletory Ratio ?
(a) 50%
(b) 33.3%
(c) 200%
(d) 60%
Answer: (a) 50%
Question 19.
Debtors Turnover Ratio :
Answer: (c)
Question 20.
When opening stock is ₹ 50,000 closing stock ₹ 60,000 and cost of goods sold is ₹ 2,20,000, then stock turn over ratio is:
(a) 2 times
(b) 3 times
(c) 4 times
(d) 5 times
Answer: (a) 2 times
Question 21.
What does Creditors Turnover Ratio take into account:
(a) Total credit purchases
(b) Total credit sales
(c) Total cash sales
(d) Total cash purchases
Answer: (a) Total credit purchases
Question 22.
Cost of goods sold :
(a) Sales – Net profit
(b) Sales – Gross profit
(c) Purchases – Opening Stock
(d) None of the above
Answer: (b) Sales – Gross profit
Question 23.
Proprietory Ratio indicates the relationship between proprietor’s funds and….
(a) Reserve
(b) Share Capital
(c) Total Assets
(d) Debentures
Answer: (c) Total Assets
Question 24.
The term‘Current Assets’include
(a) Long-term Investment
(b) Short-term Investment
(c) Furniture
(d) Preliminary Expenses
Answer: (b) Short-term Investment
Question 25.
The ideal liquid ratio is :
(a) 2 : 1
(b) 1 : 1
(c) 5 : 1
(d) 4 : 1
Answer: (b) 1 : 1
Question 26.
Profitability Ratios are generally expressed in :
(a) Simple Ratio
(b) Percentage
(c) Times
(d) None of these
Answer: (b) Percentage
Question 27.
Operating Ratio is:
(a) Profitability Ratio
(b) Activity Ratio
(c) Solvency Ratio
(d) None of these
Answer: (a) Profitability Ratio
Question 28.
Stock turnover ratio comes under :
(a) Liquidity Ratio
(b) Profitability Ratio
(c) Activity Ratio
(d) None of these
Answer: (c) Activity Ratio
Question 29.
The satisfactory ratio between internal and external equity is. :
(a) 1 : 2
(b) 2 : 1
(c) 3 : 1
(d) 4 : 1
Answer: (b) 2 : 1
Question 30.
Current Ratio =
(a) Current Assets/Current Liabilities
(b) Liquid Assets/Current Liabilities
(c) Liquid Assets/Current Assets
(d) Fixed Assets/Current Assets
Answer: (a) Current Assets/Current Liabilities
Question 31.
Liquid Assets include :
(a) Bills Receivable
(b) Debtors
(c) Cash Balance
(d) All of these
Answer: (d) All of these
Question 32.
The ideal current ratio is :
(a) 2 : 1
(b) 1 : 2
(c) 3 : 2
(d) 3 : 4
Answer: (a) 2 : 1
Question 33.
Which of the following assets is not taken into consideration in calculating acid-test ratio ?
(a) Cash
(b) Bills Receivable
(c) Stock
(d) None of these
Answer: (c) Stock
Question 34.
The two basic measures of liquidity are :
(a) Inventory Turnover and Current Ratio
(b) Current Ratio and Liquid Ratio
(c) Current Ratio and Average Collection Period
(d) Current Ratio and Debtors Turnover Ratio
Answer: (b) Current Ratio and Liquid Ratio
Question 35.
Liquid Ratio is also known as:
(a) Current Ratio
(b) Quick Ratio
(c) Capital Ratio
(d) None of these
Answer: (b) Quick Ratio
Question 36.
To test the liquidity of a concern which of the following ratios is useful ?
(a) Capital Turnover Ratio
(b) Acid Test Ratio
(c) Stock Turnover Ratio
(d) Net Profit Ratio
Answer: (b) Acid Test Ratio
Question 37.
Profitability Ratio is generally shown in :
(a) Simple Ratio
(b) Percentage
(c) Times
(d) None of these
Answer: (b) Percentage
Question 38.
When Cash is 7 10,000 Stock is 7 25,000, B/R is 7 5,000 Creditors is 7 22,000 and Bank Overdraft is 7 8,000 then current ratio is :
(a) 2 : 1
(b) 4 : 3
(c) 3 : 4
(d) 1 : 2
Answer: (b) 4 : 3
Question 39.
The term ‘Current Liabilities’ does not include: .
(a) Sundry Creditors
(b) Debentures
(c) Bills Payable
(d) Outstanding Expenses
Answer: (b) Debentures
Every year CBSE conducts board exams for 12th standard. These exams are very competitive to all the students. So our website provides online tests for all the 12th subjects. These tests are also very effective and useful for those who preparing for competitive exams like NEET, JEE, CA etc. It can boost their preparation level and confidence level by attempting these chapter wise online tests.
These online tests are based on latest CBSE Class 12 syllabus. While attempting these our students can identify the weak lessons and continuously practice those lessons for attaining high marks. It also helps to revise the NCERT textbooks thoroughly.
Question 1.
Common-size Statement are also known as:
(a) Dynamic Analysis
(b) Horizontal Analysis
(c) Vertical Analysis
(d) External Analysis
Answer: (c) Vertical Analysis
Question 2.
The most commonly used tools for financial analysis are:
(a) Comparative Statements
(b) Common-size Statement
(c) Accounting Ratios
(d) All the above
Answer: (d) All the above
Question 3.
Tools for comparison of financial statements are :
(a) Comparative Balance Sheet
(b) Comparative Income Statement
(c) Common-size Statement
(d) All the above
Answer: (d) All the above
Question 4.
Comparative Financial Statements show:
(a) Financial position of a concern
(b) Earning capacity of a concern
(c) Both of them
(d) None of these
Answer: (c) Both of them
Question 5.
Common-size financial statements are mostly prepared:
(a) In proportion
(b) In percentage
(c) (a) and (b) both
(d) None of these
Answer: (b) In percentage
Question 6.
Which of the following is not a limitations of financial statement analysis ?
(a) To measure the financial strength
(b) Affected by window-dressing
(c) Do not reflect changes in price level
(d) Lack of Qualitative Analysis
Answer: (a) To measure the financial strength
Question 7.
Tangible assets of company increased from T 4,00,000 to T 5,00,000. What is the percentage of change ?
(a) 20%
(b) 25%
(c) 33%
(d) 50%
Answer: (b) 25%
Question 8.
Horizontal Analysis is also known as :
(a) Dynamic Analysis
(b) Structural Analysis
(c) Static Analysis
(d) None of these
Answer: (a) Dynamic Analysis
Question 9.
Which of the following shows the actual financial position of n enterprise ?
(a) Fund Flow
(b) Balance Sheet
(c) P & L A/c
(d) Ratio Analysis
Answer: (b) Balance Sheet
Question 10.
A company’s net sales are ₹ 15,00,000; cost of sales is ₹ 10,00,000 and indirect expenses are ₹ 3,00,000, the amount gross profit will be:
(a) ₹ 13,00,000
(b) ₹ 5,00,000
(c) ₹ 2,00,000
(d) ₹ 12,00,000
Answer: (c) ₹ 2,00,000
Question 11.
If total assets of a firm are 7 12,00,000 and its non of non-current assets to total assets ?
(a) 50%
(b) 75%
(c) 25%
(d) 80%
Answer: (b) 75%
Question 12.
Which of the following is the purpose or objective of financial analysis ?
(a) To assess the current profitability of the firm
(b) To measure the solvency of the firm
(c) To assess the short-term and long-term liquidity position of the firm
(d) All the above
Answer: (d) All the above
Question 13.
Financial analysis is significant because it:
(a) Ignores qualitative aspect
(b) Judges operational efficiency
(c) Suffers from the limitations of financial statements
(d) It is affected by personal ability and bias of the analysis
Answer: (b) Judges operational efficiency
Question 14.
If total assets of a firm are 7 10,00,000 and its non-current assets are 7 6,00,000, what will be the percentage of current assets on total assets ?
(a) 60%
(b) 50%
(c) 40%
(d) 30%
Answer: (c) 40%
Question 15.
Break-even point refers to that point where :
(a) Total Costs are more than Total Sales
(b) Total Costs are less than Total Sales
(c) Total Costs are half of the Total Sales
(d) Total Cost are equal to total sales
Answer: (d) Total Cost are equal to total sales
Question 16.
Payment of Income Tax is considered as :
(a) Direct Expenses
(b) Indirect Expenses
(c) Operating Expenses
(d) None of these
Answer: (b) Indirect Expenses
Question 17.
Which of these are not the method of financial statement analysis ?
(a) Ratio Analysis
(b) Comparative Analysis
(c) Trend Analysis
(d) Capitalisation Method
Answer: (d) Capitalisation Method
Question 18.
In a common-size Balance Sheet, total equity and liabilities are assumed to be equal to :
(a) 1,000
(b) 100
(c) 10
(d) 1
Answer: (b) 100
Question 19.
Interpretation of Financial Statements includes:
(a) Criticisms and Analysis
(b) Comparison and Trend Study
(c) Drawing Conclusion
(d) All the above
Answer: (d) All the above
Question 20.
Break-even Analysis shows:
(a) Relationship between cost and sales
(b) Relationship between production and purchases
(c) Relationship between cost and revenue
(d) None of these
Answer: (a) Relationship between cost and sales
Question 21.
Sales less Cost of goods sold is called :
(a) Operating Profit
(b) Gross Profit
(c) Net Profit
(d) Total Profit
Answer: (b) Gross Profit
Question 22.
Trend ratios and trend percentage are used in :
(a) Dynamic analysis
(b) Static analysis
(c) Horizontal analysis
(d) Vertical Analysis
Answer: (c) Horizontal analysis
Question 23.
In which meeting of company directors report is presented ?
(a) Directors Meeting
(b) Annual General Meeting
(c) Manager’s Meeting
(d) All of the above
Answer: (b) Annual General Meeting
Question 24.
Analysis of financial statements involve :
(a) Trading A/c
(b) Profit & Loss statement
(c) Balance Sheet
(d) All the above
Answer: (d) All the above
Question 25.
Comparative financial analysis process shows the comparison between the items of which statement:
(a) Balance Sheet
(b) Profit & Loss Statement
(c) (a) and (b) both
(d) None of these
Answer: (c) (a) and (b) both
Question 26.
What is shown by Balance Sheet ?
(a) Accuracy of books of accounts
(b) Profit or loss of a specific period
(c) Financial position on a specific date
(d) None of the above
Answer: (c) Financial position on a specific date
Question 27.
A company’s shareholders fund was 7 8,00,000 in the year 2015. It because 7 12,00,000 in the year 2016. What is percentage of change ?
(a) 100%
(b) 25%
(c) 50%
(d) 33.3%
Answer: (c) 50%
Question 28.
The financial statements of a business enterprise include:
(a) Balance Sheet
(b) Profit & Loss Account
(c) Cash Flow Statement
(d) All the above
Answer: (d) All the above
Question 29.
An annual report is issued by company to its :
(a) Directors
(b) Auditors
(c) Shareholders
(d) Management
Answer: (c) Shareholders
Question 30.
The analysis of financial statement by a shareholder is an example of:
(a) External Analysis
(b) Internal Analysis
(c) Vertical Analysis
(d) Horizontal Analysis
Answer: (a) External Analysis
Question 31.
Financial analysis is useful:
(a) For Investors
(b) For Shareholders
(c) For Debenture holders
(d) All the above
Answer: (d) All the above
Question 32.
Balance Sheet provides information about financial position of the enterprise :
(a) At a Point of Time
(b) Over a Period of Time
(c) For a Period of Time
(d) None of the above
Answer: (a) At a Point of Time
Question 33.
Profit & Loss Account is also called :
(a) Balance Sheet
(b) Income Statements
(c) Operating Profit
(d) Investment
Answer: (b) Income Statements
Question 34.
Vertical Analysis is also known as :
(a) Fluctuation Analysis
(b) Static Analysis
(c) Horizontal Analysis
(d) None of these
Answer: (b) Static Analysis
Question 35.
Which of the following statement is correct ?
(a) Assets = Liabilities + Shareholders funds
(b) Assets = Total funds
(c) Assets = Funds of outsiders .
(d) None of the above
Answer: (a) Assets = Liabilities + Shareholders funds
Question 36.
What is shown by the Income Statement ?
(a) Accuracy of books of accounts
(b) Profit or loss of a certain period
(c) Balance of Cash Book
(d) None of these
Answer: (b) Profit or loss of a certain period
Question 37.
Out of the following which parties are interested in financial statements ?
(a) Managers
(b) Financial Institutions
(c) Creditors
(d) All the these
Answer: (d) All the these
Question 38.
Financial analysis is significant because it:
(a) Ignores qualitative aspect
(b) Judges operational efficiency
(c) Suffers from the limitations of financial statements
(d) It is affected by personal ability and bias of the analysis
Answer: (b) Judges operational efficiency
Question 39.
Comparative Statements are also known as :
(a) Dynamic Analysis
(b) Horizontal Analysis
(c) Vertical Analysis
(d) External Analysis
Answer: (b) Horizontal Analysis
