1. Horizontal Analysis shows the comparison of data for several years against a chosen ---------------- year.
Correct : A. Base year
2. Vertical analysis is made to review and analyse the financial statements of -----------------accounting period.
Correct : A. One
3. Comparison of financial variables of a firm over a period of time is known as--------------
Correct : C. Trend analysis
4. Interpretation requires analysis and ----------------------------------
Correct : A. Comaprison
5. The process of deriving conclusions from the analysis is commonly termed as ----------------
Correct : D. Interpretation
6. Common size Income Statement present the various items as a percentage of ----------------
Correct : A. Sales
7. External analysis is based on ------------- financial statements
Correct : B. Published
8. Financial Statements provide a summary of --------------------------
Correct : A. Accounts
9. When financial statements for a number of years are reviewed and analysed, the analysis is known
as ---------------------
Correct : C. Horizontal analysis
10. When ratios are calculated from the financial statements of one year, it is known as ---------------------
Correct : B. Vertiacal analysis
11. Horizontal analysis is also known as -----------------------
Correct : C. Dynamic analysis
12. Trend analysis is significant for
Correct : A. Forecasting and budgeting
13. In trend percentage the base year is ----------------------------
Correct : A. The first year
14. Comparative statements are a form of ---------------------------
Correct : A. Horizontal analysis
15. The term financial ananlysis include both --------- and interpretation
Correct : B. Analysis
16. Vertical analysis is also known as ------------------
Correct : B. Static analysis
17. The statement prepared to disclose accounting information are known as-----
Correct : C. Financial statements
18. ------------- gives a diagnosis of the profitability and financial position
Correct : A. Analysis of financial statements
19. ------------------------ helps in drawing inferences of conclusions
Correct : B. Interpretation
20. ---------------- establishes the relationship of different individual items which same common items
Correct : A. Common size statements
21. Under ------------------------ each item of expenses taken as a percentage on net sales
Correct : D. Common size Income Statement
22. ----------- helps to disclose financial position
Correct : C. Balance sheet
23. Disclose accounting information
Correct : D. Financial statements
24. Afford full diagnosis of the profitability and financial position
Correct : D. Analysis of financial statements
25. Study of the trend of the same items of two or more balance sheets
Correct : D. Comparative Balance Sheet
26. Expressed as a percentage of each asset to total
Correct : B. Common size Balance Sheet
27. Ratios of different items for various periods are calculated and compared
Correct : D. Ratio analysis
28. Yard stick which measures relationship between two variables
Correct : B. Ratio
29. The ratio which depicts the relationship between two items,one of which is drawn from the Balance
Sheet and the other from the revenue account
Correct : D. Debtors Turn over Ratio
30. The ratio of liquid asset to current liabilities
Correct : A. Quick ratio
31. Equity includes --------------
Correct : C. Equity capital+Prefernce share capital+reserves snd surplus-fictious asset
32. The ratio which shows the relationship b/w share holder’s fund and total assets
Correct : B. Proprietary ratio
33. Long term solvency of a firm can be measured by
Correct : D. Debt equity ratio
34. The ratio that shows the relationship between fixed asset to share holders fund
Correct : A. Fixed asset to net worth
35. The index of efficiency and profitability of the business
Correct : D. Net profit ratio
36. The ratio that includes whether investment in inventory is efficiently used or not
Correct : A. Inventory turnover ratio
37. Comparison and interpretation of ratio is known as ---------------------
Correct : C. Ratio analysis
38. Powerful tool for analyzing financial statement is ----------
Correct : B. Ratio analysis
39. The relationship between two amount or variables is measured with the help of ------------
Correct : A. Ratio
40. The main aim of the ratio analysis is to help the ----------of the firm
Correct : D. Management
41. Ratios indicate trends in important items and this helps in -----------
Correct : A. Forecasting
42. Ratios help the management in evolving market strategies through -----------
Correct : A. Inter firm comparison
43. Ratios may be used as a measure of -------------
Correct : A. Effiency
44. An example of Balance Sheet ratio is ---------------
Correct : C. Current ratio
45. Income statement ratios are also called -----------
Correct : A. Operating ratio
46. Leverage ratios are also known as -------------- ratios
Correct : B. Long term solvency ratios
47. The ratios that shows tha capacity of the business unit to meet its short term obligation out of its
short term resources is known as --------------
Correct : C. Liquidity ratio
48. The ratio that highlight the end result of business activities are known as ---------------- ratios
Correct : D. Profitability
49. The efficiency of the management can be measured with the help of ------------------
Correct : A. Activity ratio
50. The ratio of current asset to currnt liability is known as --------------
Correct : B. Current ratio
51. The asset, the amount of which can be realized within a period of one year are known as
----------------
Correct : B. Current asset
52. The ideal current ratio is -------------
Correct : A. 2:1
53. The ratio which shows the relationship between borrowed funds and owners capital is ---------------
Correct : B. Debt equity ratio
54. Proprietary ratio measures the relationship between share holder fund and ------------------
Correct : A. Total asset
55. The relationship between total outside liabilities and total assets can be indicated through ------------
Correct : B. Solvency ratio
56. Debt service ratio is also known as --------------
Correct : A. Interest coverage ratio
57. Debt equity ratio is an example of ---------------- ratios
Correct : A. Balance sheet ratio
58. Income tax payable come under ------------------
Correct : C. Current liability
59. Stock and prepaid expanses are not included in ----------------
Correct : D. Quick asset
60. In a sound business, acid test ratio ------------------- is considered satisfactory
Correct : C. 1:1
61. Cost of good sold+operating expanses=-------------------------
Correct : D. Operating cost
62. Example of activity ratios ------------------------
Correct : D. Stock turn over ratio
63. Example of leverage ratio
Correct : D. Solvency ratio
64. Current ratio is an example of --------------------
Correct : B. Liquidity ratio
65. Stock turn over ratio is an example of -------------------
Correct : D. Activity ratios
66. Ratio analysis is a study of relationship among various --------------- factors in a business
Correct : C. Financial
67. Liquidity ratios measure the --------- solvency of a firm
Correct : B. Short term
68. By computing current ratio ---------------- solvency of a concern is assessed
Correct : A. Short term
69. ---------------- ratio studies the firm’s ability to meet its long term financial position
Correct : D. Leverage
70. Satisfactory level of debt equity ratio is --------------------
Correct : C. 2:1
71. Operating ratio establishes the relationship between --------------- and net sales
Correct : D. Operating cost
72. For dividend yield ratio -------------- price of the equity shares is taken into consideration
Correct : A. Market
73. Coverage of fixed assets by shareholder’s equity is a good tests of----------------
Correct : A. solvency
74. Net worth refers to owner’s--------------------------
Correct : A. Equity
75. Ratio to assess the short term debt paying capacity of a firm is----------
Correct : C. Liquid ratio
76. The ratio which is used to ascertain the soundness of the long term financial position is------------
Correct : A. Debt equity ratio
77. If the current assets and working capital of a company are rs.80,000 and rs.50000 then current
liability will be-------------
Correct : D. Rs.30000
78. The ratio which is a good indicator to maintain the correct selling price and efficiency of trading
activity is------
Correct : B. Gross profit ratio
79. Return on investment is a----------------
Correct : C. Combined ratio
80. Debtors turnover ratio also known as----------
Correct : B. Receivable turnover ratio
81. The operating profit and net sale of a firm are rs.2,00,000 and rs.10,00,000 respectively then
operating ratio will be
Correct : A. 20%
82. The ratio which indicates how quickly debtors are converted into cash is---------
Correct : A. Receivable turnover ratio
83. Net capital employed is equal to ---------------
Correct : B. Fixed asset plus net working capital
84. Ratio of net profit before interest and tax to sales is------------------------------
Correct : C. Operating profit ratio
85. Lower stock turnover ratio indicates-------------------------------
Correct : C. Over investment in inventory
86. Collection of book debts-----
Correct : A. Has no effect on current ratio
87. Debt equity ratio is a--------------------------------------
Correct : D. Long term solvency ratio
88. Market price per share divided by earnings per share is-------
Correct : A. Price earning ratio
89. Solvency ratio indicates-----------------
Correct : A. Credit worthiness
90. Current ratio shows-----
Correct : B. The working capital position
91. Current ratio is 4:1, the amount of current liabilities is Rs.12000 the amount of working capital is-----
Correct : A. Rs.48,000
92. Stock turnover ratio is used to determine -----------------------of an enterprise
Correct : C. Efficiency
93. Working capital is expressed as------
Correct : C. Current assets-current liabilities
94. Dividend yield is an example for------ratio
Correct : C. Market strength
95. Debtors turnover ratio is used to calculate------
Correct : A. efficiency
96. Rol measures-----
Correct : A. Profitability in relation to investment
97. Debtors turnover ratio measures----------
Correct : D. Credit policy
98. Fund flow refers to change in-----
Correct : A. Working capital
99. Depreciation is sometimes treated as -------of funds