| 1. |
Horizontal Analysis shows the comparison of data for several years against a chosen ---------------- year. |
| A. | Base year |
| B. | Previous year |
| C. | Financial year |
| D. | Calender year |
| Answer» A. Base year | |
| 2. |
Vertical analysis is made to review and analyse the financial statements of -----------------accounting period. |
| A. | One |
| B. | Two |
| C. | Three |
| D. | Four |
| Answer» A. One | |
| 3. |
Comparison of financial variables of a firm over a period of time is known as-------------- |
| A. | Comparative |
| B. | Common-size |
| C. | Trend analysis |
| D. | None of the above |
| Answer» C. Trend analysis | |
| 4. |
Interpretation requires analysis and ---------------------------------- |
| A. | Comaprison |
| B. | Determination |
| C. | Decision Making |
| D. | Conclusion |
| Answer» A. Comaprison | |
| 5. |
The process of deriving conclusions from the analysis is commonly termed as ---------------- |
| A. | Analysis |
| B. | Conclusion |
| C. | Comparison |
| D. | Interpretation |
| Answer» D. Interpretation | |
| 6. |
Common size Income Statement present the various items as a percentage of ---------------- |
| A. | Sales |
| B. | Credit sales |
| C. | Cash sales |
| D. | None of the above |
| Answer» A. Sales | |
| 7. |
External analysis is based on ------------- financial statements |
| A. | Annual |
| B. | Published |
| C. | Prepared |
| D. | Previous |
| Answer» B. Published | |
| 8. |
Financial Statements provide a summary of -------------------------- |
| A. | Accounts |
| B. | Assets |
| C. | Liabilities |
| D. | Expenses |
| Answer» A. Accounts | |
| 9. |
When financial statements for a number of years are reviewed and analysed, the analysis is known as --------------------- |
| A. | Vertical nalysis |
| B. | Internal analysis |
| C. | Horizontal analysis |
| D. | External analysis |
| Answer» C. Horizontal analysis | |
| 10. |
When ratios are calculated from the financial statements of one year, it is known as --------------------- |
| A. | Horizontal analysis |
| B. | Vertiacal analysis |
| C. | Internal Analysis |
| D. | External analysis |
| Answer» B. Vertiacal analysis | |
| 11. |
Horizontal analysis is also known as ----------------------- |
| A. | Static analysis |
| B. | Structural analysis |
| C. | Dynamic analysis |
| D. | None of these |
| Answer» C. Dynamic analysis | |
| 12. |
Trend analysis is significant for |
| A. | Forecasting and budgeting |
| B. | Profit planning |
| C. | Capital rationing |
| D. | None of the above |
| Answer» A. Forecasting and budgeting | |
| 13. |
In trend percentage the base year is ---------------------------- |
| A. | The first year |
| B. | Last year |
| C. | Any year |
| D. | Second year |
| Answer» A. The first year | |
| 14. |
Comparative statements are a form of --------------------------- |
| A. | Horizontal analysis |
| B. | Vertical analysis |
| C. | Parellel analysis |
| D. | None of the above |
| Answer» A. Horizontal analysis | |
| 15. |
The term financial ananlysis include both --------- and interpretation |
| A. | Comparison |
| B. | Analysis |
| C. | Conclusion |
| D. | Constructions |
| Answer» B. Analysis | |
| 16. |
Vertical analysis is also known as ------------------ |
| A. | Dynamic analysis |
| B. | Static analysis |
| C. | External nalysis |
| D. | Internal analysis |
| Answer» B. Static analysis | |
| 17. |
The statement prepared to disclose accounting information are known as----- |
| A. | Comparative statements |
| B. | Common size statements |
| C. | Financial statements |
| D. | None of the above |
| Answer» C. Financial statements | |
| 18. |
------------- gives a diagnosis of the profitability and financial position |
| A. | Analysis of financial statements |
| B. | Preparation of financial statements |
| C. | Construction of statements |
| D. | None of the above |
| Answer» A. Analysis of financial statements | |
| 19. |
------------------------ helps in drawing inferences of conclusions |
| A. | Analysis |
| B. | Interpretation |
| C. | Comparison |
| D. | None of the above |
| Answer» B. Interpretation | |
| 20. |
---------------- establishes the relationship of different individual items which same common items |
| A. | Common size statements |
| B. | Comparative statements |
| C. | Trend analysis |
| D. | Comparative Income Statement |
| Answer» A. Common size statements | |
| 21. |
Under ------------------------ each item of expenses taken as a percentage on net sales |
| A. | Comparative income statement |
| B. | Comparative balance sheet |
| C. | Common size Balance sheet |
| D. | Common size Income Statement |
| Answer» D. Common size Income Statement | |
| 22. |
----------- helps to disclose financial position |
| A. | Trial Balance |
| B. | Profit and Loss Account |
| C. | Balance sheet |
| D. | Income Statement |
| Answer» C. Balance sheet | |
| 23. |
Disclose accounting information |
| A. | Balance sheet |
| B. | Trading account |
| C. | Profit and Loss Account |
| D. | Financial statements |
| Answer» D. Financial statements | |
| 24. |
Afford full diagnosis of the profitability and financial position |
| A. | Preparation of Profit and Loss Account |
| B. | Balance Sheet |
| C. | Final Accounts |
| D. | Analysis of financial statements |
| Answer» D. Analysis of financial statements | |
| 25. |
Study of the trend of the same items of two or more balance sheets |
| A. | Common size Profit and Loss A/C |
| B. | Common size balance sheet |
| C. | Comparative Income statement |
| D. | Comparative Balance Sheet |
| Answer» D. Comparative Balance Sheet | |