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UnitII

ModuleII

FinancialStatement
Analysis

MultipleChoiceQuestions
(MCQ)





1. Thetermfinancialstatementrefersto
a)Incomestatement b)CashflowandFundFlow
c)Balancesheet d)All

2. Whichofthefollowingisthemainobjectiveofafinancialstatement?
a)toknowthesolvency b)toknowthedebtcapacity
c)toknowtheearningcapacity d)All

3. Infinancialstatements,thefixedassetsareshownat
a)Marketprice b)Costprice
c)Replacementprice d)None

4. Whatisfollowedwhilepreparingthefinancialstatements?
a)Accountingconventions b)Accountingprinciples
c)Accountingconcepts d)All

5. Infinancialstatementthestockisvaluedatcostormarketprice
whicheverislessonthebasisof
a)Accountingconcepts b)Accountingconventions
c)Accountingprinciples d)None

6. Whichofthefollowingstatementistrue?
StatementA:Financialstatementsarepreparedonthebasisof
accountingprinciples.
StatementB:Anychangesintheaccountingprinciplesormethodwill
affecttheutilityofthefinancialstatements.
a)AistruebutnotB b)BistruebutnotA
c)Botharetrue d)Botharefalse

7. Thebalancesheetshows
a)thesourceofworkingcapital b)thechangeinworkingcapital
c)Both d)None

8. Theanalysisandinterpretationsofthefinancialstatementwillreveal
a)thefinancialposition b)theprofitability
c)None d)Both

9. Theprocessofexplainingthemeaning,significanceandrelationship
betweentwofinancialfactorsiscalled
a)Summarisation b)Analysis
c)Interpretation d)None

10. Theprocessofcomparingvariousfinancialfactorsofacompanyovera
periodoftimeisknownas
a)Interfirmcomparison b)RatioAnalysis
c)Intrafirmcomparison d)Interindustrycomparison

11. Whichofthefollowingistechniqueoffinancialstatementanalysis?
a)Commonsizestatement b)Comparativestatement
c)Trendanalysis d)All

12. Whichtechniqueusedforfiguresoftwoormoreperiodsareplacedside
bysidetofacilitateeasyandmeaningfulcomparisons?
a)Comparativestatement b)Commonsizestatement
c)TrendAnalysis d)None

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