This quiz works best with JavaScript enabled. Home > Class 12 > Class 12 Accountancy Chapter 8 Analysis Of Financial Statements – Quiz 4 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Class 12 Accountancy Chapter 8 Analysis Of Financial Statements Quiz 4 (25 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Each dollar amount on a financial statement is also stated as a percentage of a base amount on the same statement A) Horizontal analysis. B) Vertical analysis. C) All the above. D) None of the above. Show Answer Correct Answer: B) Vertical analysis. 2. Ozark Company has a profit margin of 12%. This means, A) They spend $ 12 for every $ 1 they make. B) They keep $ 1 in profit for every $ 1000 in revenue. C) They keep 12 cents for every $ 1.00 of sales. D) They spend 12% of their budget. Show Answer Correct Answer: C) They keep 12 cents for every $ 1.00 of sales. 3. Trading account is prepared to know A) Gross profit. B) Net profit. C) Balance of capital. D) Financial position. Show Answer Correct Answer: A) Gross profit. 4. Adjustment of outstanding expenses will be A) Only debit side of trading account. B) Only in debit side of profit and loss account. C) In debit side of trading or profit and loss account and liability side of balance sheet. D) All of above. Show Answer Correct Answer: C) In debit side of trading or profit and loss account and liability side of balance sheet. 5. Short term loan is a current liability A) TRUE. B) FALSE. C) All the above. D) None of the above. Show Answer Correct Answer: A) TRUE. 6. What is gross profits as per the income statement? A) $ 200.1M. B) $ 455.1M. C) $ 655.1M. D) $ 321.6M. Show Answer Correct Answer: B) $ 455.1M. 7. Working Capital is Current Assets subtracted from Current Liabilities A) TRUE. B) FALSE. C) All the above. D) None of the above. Show Answer Correct Answer: B) FALSE. 8. Closing stock shown inside the trial balance is shown in A) Trading account. B) Profit and loss account. C) Balance sheet. D) None of these. Show Answer Correct Answer: C) Balance sheet. 9. If a stock has a beta greater than 1, it means that the stock is: A) More volatile than the market. B) Less volatile than the market. C) Unpredictable. D) Not affected by market movements. Show Answer Correct Answer: A) More volatile than the market. 10. Owner's equity is calculated by A) Subtracting total liabilities from totalassets. B) Dividing total liabilities by total assets. C) Subtracting total assets from totalliabilities. D) Dividing total assets by total liabilities. Show Answer Correct Answer: A) Subtracting total liabilities from totalassets. 11. Why are financial statements important for businesses? A) Financial statements are only used for tax evasion. B) Financial statements are irrelevant for businesses. C) Financial statements only benefit competitors. D) Financial statements provide insights into a company's financial health, performance, and position, aiding in decision-making, attracting investors, securing loans, and ensuring regulatory compliance. Show Answer Correct Answer: D) Financial statements provide insights into a company's financial health, performance, and position, aiding in decision-making, attracting investors, securing loans, and ensuring regulatory compliance. 12. Analysis simply means ..... data. A) Complexing data. B) Simplification. C) Hiding data. D) None. Show Answer Correct Answer: B) Simplification. 13. Financial analysis is used only by the creditors. A) True. B) False. C) All the above. D) None of the above. Show Answer Correct Answer: B) False. 14. What is the net worth of a company also known as? A) Revenue. B) Asset Total. C) Equity. D) Gross Profit. Show Answer Correct Answer: C) Equity. 15. If Sales are 160, 000 and Total Expenses are 160, 000 and Total Expenses are 160, 000 and Total Expenses are 120, 000, what is the operating ratio? A) 42.0%. B) 75.0%. C) 20.0%. D) 133.0%. Show Answer Correct Answer: B) 75.0%. 16. Which statement would you examine to understand a company's debts and assets? A) Equity Statement. B) Cash Flow Statement. C) Income Statement. D) Balance Sheet. Show Answer Correct Answer: D) Balance Sheet. 17. Total Assets of a firm is Rs 80 lakh. Its net worth and term liabilities are Rs 15 and 20 lakh respectively. calculate current liability? A) Rs. 35 Lakh. B) Rs. 45 Lakh. C) Rs. 115 Lakh. D) Rs. 65 Lakh. Show Answer Correct Answer: A) Rs. 35 Lakh. 18. The three most important financial reports are: A) Revenue Report, Shareholder Equity, Profit Analysis. B) Profit Analysis, Balance Sheet, Cash Flow Statement. C) All answers are correct. D) Income Statement, Balance Sheet, Cash Flow Statement. Show Answer Correct Answer: D) Income Statement, Balance Sheet, Cash Flow Statement. 19. Which of the following is considered a current asset on the Balance Sheet? A) Trademarks. B) Equipment. C) Inventory. D) GoodwillTagsDOK Level 1:Recall. Show Answer Correct Answer: C) Inventory. 20. What is the vaule of financial leverage? A) 1.36. B) 1.59. C) 1.42. D) 1.28. Show Answer Correct Answer: A) 1.36. 21. What does a beta of 1 represent? A) No correlation with the market. B) Perfect correlation with the market. C) Negative correlation with the market. D) Zero volatility. Show Answer Correct Answer: B) Perfect correlation with the market. 22. From the given items which is a part of current liabilities A) Inventories. B) Trade payables. C) Cash and cash equivalents. D) Trade receivables. Show Answer Correct Answer: B) Trade payables. 23. Salaries and wages appearing in trial balance is shown A) On debit side of trading account. B) On debit side of PL account. C) On asset side of balance sheet. D) On the liabilities side of balance sheet. Show Answer Correct Answer: B) On debit side of PL account. 24. When you study a company's business model, product mix, competition, management, and brand, you are studying ..... measures. A) Creative. B) Quantitative. C) Qualitative. D) Technical. Show Answer Correct Answer: C) Qualitative. 25. Income tax in case of sole trader is treated as A) Personal expenses. B) Debtors expenses. C) Business expenses. D) None of these. Show Answer Correct Answer: A) Personal expenses. ← PreviousNext →Related QuizzesClass 12 Accountancy Chapter 8 Analysis Of Financial Statements Quiz 1Class 12 Accountancy Chapter 8 Analysis Of Financial Statements Quiz 2Class 12 Accountancy Chapter 8 Analysis Of Financial Statements Quiz 3Class 12 Accountancy Chapter 8 Analysis Of Financial Statements Quiz 5Class 12 Accountancy Chapter 8 Analysis Of Financial Statements Quiz 6Class 12 Accountancy Chapter 8 Analysis Of Financial Statements Quiz 7Class 12 Accountancy Chapter 8 Analysis Of Financial Statements Quiz 8Class 12 Accountancy Chapter 8 Analysis Of Financial Statements Quiz 9Class 12 Accountancy Chapter 8 Analysis Of Financial Statements Quiz 10Class 12 Accountancy Chapter 8 Analysis Of Financial Statements Quiz 11 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books