Statement Analysis Tools and Accounting Ratios Test

Result

Statement Analysis Tools and Accounting Ratios Test - 2

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Weekly Quiz Competition

Question 1
1 / -0

While preparing Statement of Profit and Loss , net sales is Recorded as:

A
Finance Cost

B
Other Expenses

C
Other income

D
Revenue from operations

Solution

Money generated by the company from its main operation can be termed as revenue
Question 2
1 / -0

While preparing Statement of P/L, Salaries and wages are shown under:

A
Employee benefit expense

B
Cost of material consumed

C
Other Expenses

D
Finance Cost

Solution

Company can disclose information regarding aggregate expenditure and income on this items.
Question 3
1 / -0

Vinod Limited takes loan from HDFC Bank of Rs.25 Lakhs which is to be paid in 15 years. Where will you show this loan amount in balance sheet?

A
Long Term Borrowings

B
Short Term Borrowings

C
Reserve and Surplus

D
Current Liability

Solution

Loan taken for more than one year can be termed as long term borrowings
Question 4
1 / -0

Which of the following is not considered as Cash Equivalents?

A
Investment

B
Treasury bills

C
Commercial papers

D
Short term deposits in bank

Solution

Investment
Question 5
1 / -0

Purchase of building results in

A
inflow of cash

B
outflow of cash

C
no flow of cash

D
both inflow and outflow

Solution

outflow of cash
Question 6
1 / -0

An ideal Current Ratio is:

A
4 : 1

B
3 : 1

C
2 : 1

D
1 : 1

Solution

An ideal current ratio is 2:1. It means a business must try to maintain its current assets twice of current liabilities. High ratio indicates under trading and over capitalisation.
Question 7
1 / -0

Liquid Ratio is also known as:

A
Debt Equity Ratio

B
Acid Test Ratio

C
Gross Profit Ratio

D
Current Ratio

Solution

Liquid Ratio is also known as Acid Test Ratio which helps in assessing the short term liquidity position of the firm.
Question 8
1 / -0

How will you deal increase in the balance of Securities Premium Reserve 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 Equivalent

Solution

Cash flow from Financing activities
Question 9
1 / -0

Low ‘Working Capital Turnover Ratio’ indicates:

A
Over-utilization of working capital

B
No use of working capital

C
Under-utilization of working capital

D
There is no working capital

Solution

Low working capital turnover ratio indicates that the working capital of business is under-utilized. It means firm is investing in too many account receivable and inventory to support its sales.
Question 10
1 / -0

Dividend paid by a Trading company is classified under which kind of activity while preparing cash flow statement

A
Cash flow from operating activities

B
Cash flow from Financing activities

C
Cash flow from Investing activities

D
Cash Equivalent

Solution

Cash flow from Financing activities

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Re-Attempt Weekly Quiz Competition

Statement Analysis Tools and Accounting Ratios Test - 2

Result

Statement Analysis Tools and Accounting Ratios Test - 2

Score

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Rank

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SHARING IS CARING

Question 1

Finance Cost

Other Expenses

Other income

Revenue from operations

Solution

Question 2

Employee benefit expense

Cost of material consumed

Other Expenses

Finance Cost

Solution

Question 3

Long Term Borrowings

Short Term Borrowings

Reserve and Surplus

Current Liability

Solution

Question 4

Investment

Treasury bills

Commercial papers

Short term deposits in bank

Solution

Question 5

inflow of cash

outflow of cash

no flow of cash

both inflow and outflow

Solution

Question 6

4 : 1

3 : 1

2 : 1

1 : 1

Solution

Question 7

Debt Equity Ratio

Acid Test Ratio

Gross Profit Ratio

Current Ratio

Solution

Question 8

Cash flow from operating activities

Cash flow from Investing activities

Cash flow from Financing activities

Cash Equivalent

Solution

Question 9

Over-utilization of working capital

No use of working capital

Under-utilization of working capital

There is no working capital

Solution

Question 10

Cash flow from operating activities

Cash flow from Financing activities

Cash flow from Investing activities

Cash Equivalent

Solution

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