Tools Of Financial Analysis Accounting Ratios CBSE Questions & Answers

Tools Of Financial Analysis Accounting Ratios

This is Accountancy Class 12 Tools of Financial Analysis Accounting Ratios CBSE Questions & Answers. There are 15 questions in this test with each question having around four answer choices.

Questions & Answers

1
In common size statements every item of the statement is presented in the form of percentage of its important heading is known as
  • A
    Ratio analysis
  • B
    All of these
  • C
    Comparative Statements
  • D
    Common Size Statements
    Correct
2
Accounting Ratio is
  • A
    None
  • B
    Both
  • C
    tool used by individuals to conduct a quantitative analysis of information
  • D
    It is arithmetical relationship between two accounting variables
    Correct
3
___A tool used by individuals to conduct a quantitative analysis of information in a company's financial statements
  • A
    Comparative Statements
  • B
    Common Size Statements
  • C
    Ratio analysis
    Correct
  • D
    Cash flow statement
4
Ratios are expressed in
  • A
    Percentage
  • B
    Fraction
  • C
    Times
  • D
    All
    Correct
5
If we deduct current liabilities from current assets, we get_________
  • A
    Working capital
    Correct
  • B
    Reserves and surplus
  • C
    Fixed assets
  • D
    Actual profit
6
Ratio shows the relationship between current assets with current liabilities
  • A
    Gross profit ratio
  • B
    Debt ratio
  • C
    Current ratio
    Correct
  • D
    Quick ratio
7
Ideal Liquid ratio is
  • A
    It is 1:2
  • B
    It is 3:1
  • C
    It is 1:1
    Correct
  • D
    It is 2:1
8
Which of the following is a liquidity ratio?
  • A
    P/E- ratio
  • B
    Equity multiplier
  • C
    Inventory turnover
  • D
    Quick ratio
    Correct
9
Debt equity ratio is
  • A
    All of these
  • B
    Debt/Equity
    Correct
  • C
    Total Assets/Long term Debt
  • D
    Equity/Total Assets
10
Followings are the solvency ratio except
  • A
    Total Assets to Debt Ratio
  • B
    Debt equity ratio
  • C
    Quick Ratio
    Correct
  • D
    Proprietary Ratio
11
Which of the following is not included in quick assets
  • A
    Cash at bank
  • B
    Stores and spares
    Correct
  • C
    Cash in hand
  • D
    Draft in hand
12
Activities ratio
  • A
    measure the effectiveness with which a concern uses resources at its disposal
  • B
    Both of these
    Correct
  • C
    None of these
  • D
    measure the efficiency of asset management
13
INVENTORY TURNOVER RATIO is also called as
  • A
    Debtor turnover ratio
  • B
    Working capital turnover ratio
  • C
    Creditor’s turnover ratio
  • D
    Stock turnover ratio
    Correct
14
Debtor collection period is
  • A
    \(\frac{{Average{\text{ }}Debtors}}{{Credit{\text{ }}Sales}}{\text{ }} \times {\text{ 365}}\)
    Correct
  • B
    \(\frac{{Average{\text{ Creditors }}}}{{Credit{\text{ }}Sales}}{\text{ }} \times {\text{ 360}}\)
  • C
    \(\frac{{Average{\text{ }}Debtors}}{{Credit{\text{ }}Sales}}{\text{ }} \times {\text{ 360}}\)
  • D
    \(\frac{{Average{\text{ Creditors }}}}{{Credit{\text{ Purchase}}}}{\text{ }} \times {\text{ 360}}\)
15
Payable turnover ratio is called
  • A
    Stock turnover ratio
  • B
    Creditor’s turnover ratio
  • C
    working capital ratio
    Correct
  • D
    Debtor turnover ratio