## CBSE Class 12 - Accountancy - MCQs -COMPARATIVE & COMMON – SIZE STATEMENTS

CHAPTER: TOOLS FOR FINANCIAL STATEMENT ANALYSIS

Financial statements are reports prepared by a company’s management to present the financial performance and position at a point in time. A general-purpose set of financial statements usually includes a balance sheet, income statements, statement of owner’s equity, and statement of cash flows.

The various tools used for analysis of financial statements are:
1. Comparative Statement: Financial Statements of two years are compared (Horizontal Analysis)
2. Common Size Statement: Figures of Financial Statements are converted in to percentage with respect to some common base
3. Ratio Analysis
4. Cash Flow Statement

COMPARATIVE & COMMON – SIZE STATEMENTS(MCQs)

1. The most commonly used tools for financial analysis are:
(A) Comparative Statements
(B) Common Size Statements
(C) Accounting Ratios
(D) All of the above

2. Which of the following is the objective of comparative statements?
(A) To make the data simpler and understandable
(B) To indicate the trend
(C) To help in forecasting
(D) All of the above

3. Comparative Balance Sheet :
(A) Provides a summarized view of the operations of the firm
(B) Presents the financial position of the firm
(C) Presents the change in various items of balance sheet
(D) None of the above

4. Comparative Statement of Profit and Loss provides information about:
(A) Rate of increase or decrease in revenue from operations
(B) Rate of increase or decrease in cost of revenue from operations
(C) Rate of increase or decrease in net profit
(D) All of the above

5. Fixed Assets of a company increased from Rs.3,00,000 to Rs.4,00,000.
What is the percentage of change?
(A) 25%
(B) 33.3%
(C) 20%
(D) 40%

6. A company’s current liabilities decreased from Rs.4,00,000 to Rs.3,00,000. What is the percentage of change?
(A) 25%
(B) 33.3%
(C) 20%
(D) 40%

7. A company’s working capital is Rs.10 Lakh (Negative balance) in the year 2018.It became Rs.15 Lakh(positive balance) in the year 2019. What is the percentage of change?
(A) 150%
(B) 100%
(C) 250%
(D) 50%

8. Revenue from Operations Rs.4,00,000; Cost of Revenue from Operations 60% of Revenue from Operations; Operating expenses Rs.30,000 and rate of income tax is 40%. What will be the amount of profit after tax?
(A) Rs.64,000
(B) Rs.78,000
(C) Rs.52,000
(D) Rs.96,000

9. Main objective of Common Size statement is:
(A) To present the changes in various items
(B) To provide for a common base for comparison
(C) To establish relationship between various items
(D) All of the Above

10. Main objective of Common Size Balance Sheet is:
(A) To establish relationship between revenue from operations and other items of statement of profit and loss
(B) To present changes in assets and liabilities
(C) To present changes in various items of income and expenses
(D) All of the above

11. Common Size Statements are prepared
(A) In the form of ratios
(B) In the form of Percentages
(C) In both of the above
(D) None of the above

12. Which of the following is untrue:
(A) Common size Balance Sheet
(B) Common size Statement of Profit and Loss
(C) Common size Cash Flow Statement
(D) None of the above

13. Main objective of Common Size Statement of Profit and Loss is :
(A) To present changes in assets and liabilities
(B) To judge the financial soundness
(C) To establish relationship between revenue from operations and other items of statement of Profit and Loss.
(D) All of the above

14. In the statement of Profit and Loss of a Common Size Statement:
(A) Figure of net revenue from operations is assumed to be equal to 100
(B) Figure of gross profit is assumed to be equal to 100
(C) Figure of net profit is assumed to be equal to 100
(D) Figure of assets is assumed to be equal to 100

15. In the Balance Sheet of a Common size Statement:
(A) Figure of current liabilities is assumed to be 100
(B) Figure of fixed assets is assumed to be 100
(C) Figure of total assets is assumed to be 100
(D) Figure of share capital is assumed to be 100

16. Total assets of a firm are Rs.20,00,000 and its fixed assets are Rs.8,00,000. What will be the percentage of fixed assets on total assets?
(A) 60%
(B) 40%
(C) 29%
(D) 71%

17. If total assets of a firm are Rs.8,20,000 and its fixed assets are Rs5,90,400, what will be the percentage of current assets on total assets?
(A) 42%
(B) 58%
(C) 28%
(D) 72%

18. If net revenue from operations of a firm are Rs.1,20,000; cost of revenue from operations is Rs.66,000 and operating expenses are Rs.21,600, what will be the percentage of operating income on net revenue from operations ?
(A) 55%
(B) 45%
(C) 73%
(D) 27%

1 d 2 d 3 c
4 d 5 b 6 a
7 c 8 b 9 b
10 b 11 b 12 c
13 c 14 a 15 c
16 b 17 c 18 d