The ratio analysis is helpful to management in taking several decisions, but as a mechanical substitute for judgement and thinking, it is worse than useless.

Related MCQs

• Which of the following statements are false about management accounting? (i) Management accounting is concerned with historical events. (ii) Management accounting is related only with such instances which can be expressed in monetary terms. (iii) Management accounting is a part of Financial Management (iv) Management accounting information can be disclosed to outsiders.
• Which of the following is expenses ratio? (a) Administrative expenses ratio (b) Selling and Distribution expenses ratio (c) Factory expenses ratio (d) Finance Expenses ratio
• Management accounting is helpful in increasing _______________
• Fixed budget is useless for comparison when the level of activity -
• Debtors Turnover ratio is also known as (a) Receivables turnover ratio (b) Debtors velocity (c) Stock velocity (d) Payable turnover ratio
• Match the columns (i) Activity Ratio -------------------- i) (Actual hours worked / Budgeted hours) * 100 (ii) Capacity Ratio ------------------ ii) (Standard hours of actual production / Actual hours worked) * 100 (iii) Efficiency Ratio ----------------- iii) (Standard hours for actual output / Budgeted hours) * 100
• Which of the following is true about management accounting? A) Management accounting is associated with presentation of accounting data. B) Management accounting is extremely sensitive to investors needs.
• Which of the following is true about management accounting? (i) Management accounting is associated with presentation of accounting data. (ii) Management accounting is extremely sensitive to investors needs.
• ABC Ltd has total assets turnover ratio and total assets to Net worth are 1.75 and 2 respectively. If NP ratio is 10% the ROE will be :
• Variable cost ratio =80% and Mos=40%.Calculate P/V ratio and BEP(in Percentage) respectively.