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Ratio Analysis

12th Accountancy - Ratio Analysis Practice Question Paper

Ratio Analysis Practice Question Paper

12th Standard

    Reg.No. :
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Accountancy

Time : 01:00:00 Hrs
Total Marks : 40
    5 x 1 = 5

  1. The mathematical expression that provides a measure of the relationship between two figures is called

    (a)

    Conclusion

    (b)

    Ratio

    (c)

    Model

    (d)

    Decision

  2. Which one of the following is not correctly matched?

    (a)

    Liquid ratio – Proportion

    (b)

    Gross profit ratio – Percentage

    (c)

    Fixed assets turnover ratio – Percentage

    (d)

    Debt-equity ratio – Proportion

  3. _____ ratios show how efficiently assets or other items have been used to generate revenue from operations.

    (a)

    Liquidity

    (b)

    Long term solvency

    (c)

    Turnover

    (d)

    Profitability

  4. Cost of goods sold is Rs.2,00,000. The opening stock in the beginning of the year is Rs.55,000, and the closing stock at the end of the year is Rs.25,000. Therefore the stock turn over ratio is ______________

    (a)

    3 Times

    (b)

    5 Times

    (c)

    6 Times

    (d)

    4 Times

  5. Debt Equity Ratio is 3:1, the amount of total assets Rs.20 lacks, current ratio is 1.5:1 and owned funds Rs.3 lacks. What is the amount of current asset?

    (a)

    Rs.5 lacks

    (b)

    Rs.3 lacks

    (c)

    Rs.12 lacks

    (d)

    Rs.2 lacks

    6. 1 x 2 = 2

  6. Assertion (A): Total long term debt includes Debentures, long term loans from banks and financial institutions.
    Reason (R): Shareholders funds includes Equity share capital, Preference share capital, Reserves and surplus.
    (a) Both (A) and (R) are true and (R) is the correct explanation of (A)
    (b) Both (A) and (R) are true and (R) is not the correct explanation of A
    (c) (A) is true, but (R) is false
    (d) (A) is false, but (R) is true

    7. 1 x 2 = 2

  7. (a) Liquidity ratio
    (b) Turnover ratios
    (c) Sacrificing ratio
    (d) Profitability ratios

    8. 1 x 1 = 1

  8. (i) Quick ratio is used to assess the firm's short term liquidity. The relationsnip of liquid assets to current liabilities is known as Current ratio.
    (ii) Acid Test.ratio is used to assess the firm's short term liqaidity. The relationship of liquid assets to current liabilities is knofch-as Current ratio.
    (iii) This ratio is used to assess the firm's short term liquidity. The relationship of liquid assets to current liabilities is known as liquid ratio.
    (a) (i) is correct
    (b) (i) and (iii) are correct
    (c) (iii) is correct
    (d) (i), (ii) and (iii) are correct

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    (iii) is correct

    9. 1 x 2 = 2

  9. Which one of the Following is Not Correctly Matched?

    (a) Current ratio - \(\frac { Current\quad assets }{ Current\quad liabilities } \)
    (b) Quick ratio - \(\frac { Current\quad assets }{ Current\quad liabilities } \)
    (c) Debt equity ratio - \(\frac { Long\quad term\quad debt }{ Shareholderl's\quad funds } \)
    (d) Proprietary ratio - \(\frac { Shareholderl's\quad funds }{ Total\quad assets } \)
    10. 2 x 2 = 4

  10. Calculate current ratio from the following information:

    Particulars Rs. Particulars Rs.
    Current investments 80,000 Trade creditors 1,60,000
    Inventories 1,60,000 Bills payable 1,00,000
    Trade receivables 4,00,000 Expenses payable 1,40,000
    Cash and cash equivalents 1,20,000    
    Prepaid expenses 40,000    

  11. Quick ratio of a company is 1.5: 1.State giving reason, whether the ratio will improve, decline or not change on payment of divided by the company.

    12. 3 x 3 = 9

  12. Bring out the limitations of ratio analysis.

  13. Calculate
    (i) Inventory turnover ratio
    (ii) Trade receivable turnover ratio
    (iii) Trade payable turnover ratio and
    (iv) Fixed assets turnover ratio from the following information obtained from Delphi Ltd.

    Particulars As on
    31st March, 2018
    Rs.    		 As on
    31st March, 2019
    Rs.
    Inventory 1,40,000 1,00,000
    Trade receivables 80,000 60,000
    Trade payables 40,000 50,000
    Fixed assets 5,50,000 5,00,000

    Additional information:
    (i) Revenue from operations for the year Rs.10,50,000
    (ii) Purchases for the year Rs.4,50,000
    (iii) Cost of revenue from operations Rs.6,00,000.
    Assume that sales and purchases are for credit.

  14. Write a note an Long-term solvency ratios.

    15. 3 x 5 = 15

  15. Calculate the current ratio from the following information.

    Particulars Rs. Particulars Rs.
    Current investments 40,000 Fixed assets 5,00,000
    Inventories 2,00,000 Trade creditors 80,000
    Trade debtors 1,20,000 Bills payable 50,000
    Bills receivable 80,000 Expenses payable 20,000
    Cash and cash equivalents 10,000 Non-current liability 3,00,000

  16. Calculate quick ratio of Babu construction Ltd., from, the information given below

    Particulars Rs.
    Total current liabilities 2,00,000
    Total current assets 4,00,000
    Inventories 70,000
    Prepaid expenses 30,000

  17. From the following figures obtained from Sun Ltd; calculate the trade payables turnover ratio and credit payment period (in days).

    Particulars Rs.
    Credit purchases during 2018 - 2019 1,00,000
    Trade creditors as on 1.4.2018 20,000
    Trade creditors as on 31.3.2019 10,000
    Bills payable as on 1.4.2018 4,000
    Bills payable as on 31.3.2019 6,000

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