A firm makes credit revenue from operations of ₹2,40,000 during the year. Which of the following is not operating expenses? (A) 0.9 : 1 (C) 18% Average Payment Period will be : (All India 2009) (i)Gross profit ratio (D) 12.5%, 104. Ans. Gross Profit Ratio =Gross Profit/Revenue from Operations i.e. Items Included in Current Liabilities Ans. (D) 37 : 1, 64. (D) 21%, 101. (d)Short-term provisions State giving reason, whether the ratio will improve, decline or not change because of increase in the value of closing Inventory by ? Effect Increase The entire NCERT textbook questions have been solved by best teachers for you. (D) ₹26,000, 76. Liquid Assets ₹3,70,000; Inventory ₹80,000; Current Liabilities ₹1,50,000; Cost of levcnue from operations ₹7,50,000. Tax rate is 50%. (C) ₹80,000 Students are advised to follow the MCQ Questions with Answers for Class 12 Accountancy during their preparation. Download free printable assignments worksheets of Accountancy from CBSE NCERT KVS schools, free pdf of CBSE Class 12 Accountancy Accounting Ratios Assignment chapter wise important exam questions and answers CBSE Class 12 Accountancy Accounting Ratios Assignment .Chapter wise assignments are being given by teachers to students to make them understand the chapter concepts. (A) 2 Months Liquid Ratio will be On the basis of following data, a Company’s Gross Profit Ratio will be : (C) 60% (D) 65%, 111. (D) 4 : 1, 46. (C) Issue of Debentures for cash Operating Ratio =Operating Cost/ Revenue from Operations (Net sales) x 100 1. Current Assets do not include : (B) ₹1,60,000 Net Profit ₹40,000; Office Expenses ₹20,000; Selling Expenses ₹36,000; Total revenue from operations ₹6,00,000. transactions would (a) increase (b) decrease or (c) not change the ratio (A) Non-Current Liabilities Reason Neither the long-term debt nor the shareholders’ funds are affected by selling of furniture at cost. (A) 1 : 1 (A) ₹1,15,000 (i)Debt-equity ratio (B) 4 : 1 (D) None of Above, 16. Subsequently, it paid ₹50,000 to its trade payables. (B) 52 : 1 (D) Debentures. (Any four) Total revenue from operations ₹27,00,000; Credit revenue from operations ₹18,00,000; Opening Debtors ₹3,20,000; Closing Debtors ₹4,00,000; Provision for Doubtful Debts ₹60,000. (B) ₹1,16,000 (A) Increase Current ratio Thereafter, it paid 1,00,000 to its trade payables. Inventories of Finished Goods, Work-in-progress and Stock-in-trade + Direct Expenses (B) Average Inventory/Cost of Revenue from Operations (D) ₹5,00,000, 105. = 100- 81.38 =18.62%. The sample papers have been provided with marking scheme. (A) Debtors (ii) Liquid ratio/Quick ratio/Acid test ratio This ratio establishes relationship between liquid assets and current liabilities and is used to measure the firm’s ability to pay the claims of creditors immediately. (D) decrease gross profit ratio, 32. These solutions for Accounting Ratios are extremely popular among Class 12 Commerce students for Accountancy Accounting Ratios Solutions come handy for quickly completing your homework and preparing for exams. (C) Activity Ratio Current Assets of a Company were ? (A) Current ratio, Accounts receivable (B) 3 : 1 (D) 2 : 1, 63. Effect No change (iii)Issue of new shares for cash (revenue from operations) net sales. investments + Long-term loans and advances) + Working Capital – Non-current Liabilities (Long-term borrowings + Long-term provisions) State with reason which of the following transaction would increase, decrease or not change the ratio  (d)Cash and cash equivalents (cash in hand, cash at bank, cheques/drafts in hand) The questions … (B) Short Term & Long Term Debts (ii) Opening inventory Rs 60,000, closing inventory Rs 1,00,000, inventory turnover ratio 8 times and selling price 25% above cost. (ii) Purchase of fixed assets on a long-term deferred payment basis Net Profit = Revenue from Operations – Cost of Revenue from Operations – Operating Expenses – Non-operating Expenses + Non-operating Income + Tax (C) Difference between Current Assets and Current Liabilities In view of the requirements of various users, the accounting ratios may be classified as under. (D) 133%, 55. (C) 1.8 : 1 NOTE Since,non-operating assets are excluded while determining capital employed, income from non-operating assets should also be excluded from profit. (A) 3.6 : 1 (A) 6 times (A) Liquidity Ratio Accounting Ratios class 12 Notes Accountancy in PDF are available for free download in myCBSEguide mobile app. (C) ₹80,000 Its closing debtors will be : (B) ₹3,60,000 (i) Compute ‘debtors turnover ratio’ from the following information Revenue from operations (Total sales) Rs  5,20,000, cash revenue from operations 60% of the credit revenue from operations closing debtors Rs 80,000, opening debtors are 3/4th of closing debtors. (B) ₹36,000 (B) 4 : 1 (C) Cost of Revenue from Operations/Average Inventory (A) Long-Term Debts Information TopperLearning’s Experts and Students has answered all of Accounting Ratios Activity Ratios Of CBSE Class 12 Commerce Accountancy questions in detail. Sales – Gross Profit Reason Neither the long-term debt nor the shareholders’ funds are affected by purchasing of goods on credit. We have provided Accounting Ratios Class 12 Accountancy MCQs Questions with Answers to help students understand the concept very well. On the basis of following information received from a firm, its Debt-Equity Ratio will be : Question 4: The current ratio provides a better measure of overall liquidity only when a firm's inventory cannot easily be … (v)Return on investment/Capital employed It establishes the relationship between net profit before interest, tax and preference dividend and capital employed (equity + debts). ₹60,000; Revenue from Operations ₹30,00,000. Ans. Statement Analysis Tools and Accounting Ratios Class 12 Accountancy Extra Questions. (iv)Sale of goods at a profit (C) Sales Turnover (Delhi 2008; hots) On the basis of following data, a Company’s closing debtors will be: Stock turnover ratio will decline because increase in the value of closing stock by ?5,000 will increase the value of average Inventory and decrease the cost of goods sold. (C) Marketable Securities Total Assets to Debt Ratio=Total Assets/Long-term Debts (i) Purchase of fixed assets on a credit of two months Effect No change (D) 9 Times, 84. Net Sales x 100 (D) 2.5 : 1, 18. (A) 5 : 1 or When Liabilities Approach is Followed It is computed by adding Operating Cost = Cost of Materials Consumed + Purchases of Stock-in-trade + Change in Inventories of Finished Goods, Work-in-progress and Stock-in-trade + Employees Benefits Expenses + Other Expenses (Other than non-operating expenses) A Company ’ s Current Ratio is 2.5 : 1 and Liquid Ratio is 1.6 : 1. (A) 11%. (D) Trade Receivables, 11. (C) Total Assets (C) ₹2,70,000 After the payment of ? Ans. (C) 1.4 : 1 (A) ₹1,20,000 A firm’s cwTent assets are ₹3,60,000; Cur from operations is ₹12,00,000. (D) 2 : 1, 29. (i)Non-current assets, i.e. (C) 2 : 1 (D) 15%, 110. (D) 12 times, 94. 1,00,000, it can be said that the gross profit is 10% × 10,000 100 1,00,000 of the ‘Revenue from Operations’ . (C) Total Assets/Long term Debts (D) 20%, 102. Calculate operating ratio : If average inventory is ₹50,000 and closing inventory is ₹2,000 less than the opening inventory, opening and closing inventory will be : Quick ratio will be (All india 2010) Working Capital Turnover Ratio=Cost of Revenue from Operations or Revenue from Operations i. e. Net Sales/Working Capital (v)Cash received from debtors (Delhi 2011 c) (iii)Inventory turnover ratio (D) 1 : 3.75, 17. Liquid Assets : Liquid Ratio/Quick Ratio/Acid Test Ratio=Liquid Assets or Quick Assets/Current Liabilities (C) 96.33% (i)Debt equity ratio (ii) Working capital turnover ratio (A) Solvency Ratio (B) 3 : 1 (C) ₹82,000 Reason The long-term debts are increased by the purchasing of fixed assets on a long-term deferred payment basis, but the shareholders’ fund remains unchanged. Ans. (B) 20% (i) Stock turnover ratio or Inventory turnover ratio The ratio indicates the number of times the stock is turned in sales during the accounting period, i.e. (B) Capital borrowed from the Banks A Company’s liquid assets are ₹10,00,000 and its current liabilities are ₹8,00,000. If you have any query regarding CBSE Class 12 Accountancy Accounting Ratios MCQs Pdf, drop a comment below and we will get back to you at the earliest. ADVERTISEMENTS: Here is a compilation of top thirteen accounting problems on ratio analysis with its relevant solutions. (D) ₹2,80,000, 42. Current Ratio will 7.The current ratio of a company is 3 : 1. (ii)Purchase of goods on credit (iii) Sale of furniture at cost (A) Prepaid Expenses (A) 2 : 1 Students can solve NCERT Class 12 Accountancy Accounting Ratios MCQs Pdf with Answers to know their preparation level. (B) Current Assets – Inventory + Prepaid Exp. After cash payment to some of its creditors, Current Ratio will: (i)Current ratio 2.What will be the operating profit ratio, if operating ratio is 83.64%? Proprietary Ratio will be : If the trade receivables turnover ratio is 8 times, calculate closing debtors, if the closing debtors are more by ₹6,000 than the opening debtors : Proprietary Ratio=Proprietors’ Funds or Shareholders’ Funds/Total Assets A Company’s Quick Ratio is 1.5 : 1; Current Liabilities are ₹2,00,000 and Inventory is ₹1,80,000. Patents and Copyrights fall under the category of: Ans.Operating Profit Ratio = 100 – Operating Ratio (D) 1.5 : 1, 25. 10,000 less than opening creditors. (B) ₹50,000 and ₹48,000 (D) decrease gross profit ratio, 31. (i) Operating profit ratio; and (if) Working capital turnover ratio Its Current Ratio will be : (D) Cost of Production/Net revenue from operations. CBSE Class 12 Accountancy Ratio Analysis. State with reason whether the decrease in rent received by Rs 15,000 will increase, decrease or not change the ratio. Assuming liquid ratio of 1.2 : 1, cash collected from debtors would : In case, statement of profit and loss is given, cost of revenue from operations i.e. (ii)Proprietary ratio It establishes the relationship between proprietors’ funds and total assets. (A) 1.75 : 1 Opening debtors are ₹1,10,000. Credit revenue from operations ₹9,00,000; Average Collection period 2 months; Opening debtors are ₹15,000 less as compared to closing debtors. A Company’s Current Assets are ₹8,00,000 and its current liabilities are ₹4,00,000. or (C) 5 : 1 (D) ₹8,15,000, 39. Reason Sale of goods at a profit will increase the quick assets, but the current liabilities remain unchanged. Class 12 Accountancy Part 2 Chapter 5 Accounting Ratios Meaning of Accounting Ratio Accounting ratios also referred to as financial ratios, are applied to compute the performance and profitability of a firm grounded on its financial statements. (C) 4 : 7 (D) ₹60,000. Equity Share Capital ₹5,80,000; Reserve Fund ₹4,30,000; Preliminary Expenses ₹40,000; Long term Debts ₹1,28,900; Debentures ₹2,30,000. (A) 2 : 1 (A) ₹1,50,000 (C) 45 Days (C) ₹6,85,000 Net Sales x 100 I. Satisfactory ratio between Long-term Debts and Shareholder’s Funds is : Firm managers use accounting information to help them manage the fi rm. (ii)Purchase of goods on credit (iii) Sale of furniture at cost (b) Not change the ratio (C) 30% (ii) From the given information calculate the inventory turnover ratio. (C) 2 : 1 (D) ₹4,80,000, 73. (C) Inventory Cash Balance ₹5,000; Trade Payables ₹40,000; Inventory ₹50,000; Trade Receivables ₹65,000 and Prepaid Expenses are ₹10,000. Total revenue from operations ₹9,00,000; Cash revenue from operations ₹3,00,000; Debtors ₹1,00,000; B/R ₹20,000. Opening Inventory ₹40,000; Purchase ₹4,00,000; Purchase Return ₹12,000, what will be Inventory turnover ratio if Closing Inventory is less than Opening Inventory by ₹8,000? Total Assets It includes Repayment of long-term loan will reduce the long-term debt but the shareholders’funds will remain same. 1.Liquidity Ratios Liquidity ratios measure the firm’s ability to fulfil its short-term financial obligations. (B) ₹1,20,000 (b)Trade payables (bills payable and sundry creditors) (C) 1.8 : 1 (B) Current Liabilities (B) 2 : 1 (D) ₹51,000 and ₹49,000, 78. Its working capital will be : Interest Coverage Ratio =Net Profit before Interest and Tax/Interest on Long-term Debts, 3.Turnover or Performance or Activity Ratios These ratios measure how efficiently a company is using its assets to generate sales. (A) 1.33 : 1 Quick Ratio is also known as : Items Included in Total Assets (C) ₹ 80,000 (B) ₹6,95,000 (D) None of the Above, 13. (i)From the following information, compute ‘debt equity ratio’ long-term borrowings and long-term provisions). Non-current Assets (Tangible assets + Intangible assets + Non-current trade Previous Years’Examinations Questions or (A) Office Expenses (B) 5.6 times Effect Decrease (A) 10 Times Information Equity share capital Rs 10,00,000, general reserve Rs 1,00,000, balance of statement of profit and loss after interest and tax Rs 3,00,000, 12% debentures Rs 4,00,000, creditors Rs 3,00,000, land and buildings Rs 13,00,000, furniture Rs 3,00,000, debtors 12,90,000, cash Rs 1,10,000.Revenue from operations i.e. (A) Sale of goods for cash Non-current Asset (Tangible assets + Intangible assets + Non-current trade investments + Long-term loans and advances) + Working Capital – Non-current Liabilities (Long-term borrowings + Long-term provisions) Revenue from Operations ₹2,00,000; Inventory Turnover Ratio 5; Gross Profit 25%. (B) 75% (iv)Interest coverage ratio This ratio expresses the relationship between net profit before interest and tax and interest payable on long-term debts. Reason The shareholders’ funds will reduce by the amount of loss of 3,000, but the long-term debt remain unchanged. (D) 3.8 Times, 99. (B) Sale of goods on credit (C) 6 times (D) 93%, 112. (C) Payment to Trade Payables (B) 1.22 : 1 (C) 8 Times (C) have no effect on Current ratio Current liabilities of a company were ₹2,00,000 and its current ratio was 2.5 : 1. (C) 3.25 : 1 Working Capital ₹3,20,000; Current Liabilities ₹1,40,000; Fixed Assets ₹2,60,000; Debentures ₹2,10,000; Long Term Bank Debt ₹78,000. (D) 6 months, 97. (iii)Issue of new shares for cash (B) 2.1 : 1 (A) ₹1,50,000 (D) Average Collection Period, 77. (A) ₹40,000 Get all questions and answers of Accounting Ratios Activity Ratios of CBSE Class 12 Commerce Accountancy on TopperLearning. if revenue from operations are ₹6,00,000 and Gross . (A) Cash Collected from Trade Receivables Nov 27,2020 - Chapter 10 - Accounting Ratios Accountancy Class 12 is created by the best Commerce teachers for Commerce preparation. ■ Non-current Assets [Fixed assets (Tangible and intangible assets) + Non-current Investments + Long-term Loans and Advances A Company’s Liquid Assets are ₹2,00,000, Inventory is ₹1,00,000, Prepaid Expenses are ₹20,000 and Working Capital is ₹2,40,000. (C) have no effect on Current ratio Accounting ratio are used as an important tool of analysing the financial performance of the company over the years ans as comparative position among other companies in the industry. (A) ₹38,000 (i) Purchase of machinery for cash 24.From the following information, calculate the following ratios (C) Shareholder’s Funds/Total Assets (B) 2.25 : 1 (A) increase liquid ratio Its Current Ratio will be : 20,000 to the creditors, both the total of current assets and total of current liabilities will be reduced by the same amount. (Delhi 2010 c) G.P. If its Current Assets are ₹7,50,000, what will be the value of Inventory? Its worki (A) ₹63,000 All questions and answers from the NCERT Book of Class 12 Commerce Accountancy Chapter 5 are provided here for you for free. (D) Liquid ratio, inventory, 30. 82. (A) ₹1,35,000 22.From the following information, calculate any two of the following ratios (i) Liquid ratio (ii) Gross profit ratio (iii)Debt equity ratio (iv)Sale of goods at a profit (D) G.P./Average Inventory, 70. (B) 2 : 1 Purchases ₹7,20,000; Office Expenses ₹30,000; Selling Expenses ₹90,000; Opening Inventory ₹1,40,000; Closing Inventory ₹80,000; Revenue from Operations ₹12,00,000. (b)Non-current trade investments. Subsequently, it purchased goods for ₹1,00,000 on credit. (D) 2.05 : 1, 38. (iv)Working capital turnover ratio This ratio shows the number of times the working capital has been rotated in generating sales. (C) 1 : 2 Operating profit ratio is an indicator of operational efficiency of the business. (D) Bills Receivable, 12. (A) Liquidity (ii) Purchase of goods on credit (C) ₹1,00,000 (D) .5 : 1, 61. Assets Approach (C) 4 : 1 (D) 1.75 : 1, 20. Debt-equity ratio will be : On the basis of following data, a Company’s Total Assets-Debt Ratio will be: Working Capital ₹2,70,000; Current Liabilities ₹30,000; Fixed Assets ₹4,00,000; Debentures ₹2,00,000; Long Term Bank Loan ₹80,000. (B) 80% (i)Purchase of fixed assets on a credit of two months Multiple Choice Questions Question and Answer forum for K12 Students. Free PDF Download - Best collection of CBSE topper Notes, Important Questions, Sample papers and NCERT Solutions for CBSE Class 12 Accounts Accounting ratios. (A) ₹4,00,000 (D) 3 : 1, (B) Solvency Ratios (B) Prepaid Expenses Current Assets ₹4,00,000; Current Liabilities ₹2,00,000 and Inventory is ₹50,000. On the basis of following data, the liquid ratio of a company will be : Current Ratio 5 : 3; Current Liabilities ₹75,000 and Inventory ₹25,000 A Company’s Current Ratio is 3 : 1; Current Liabilities are ₹2,50,000; Inventory is ₹60,000 and Prepaid Expenses are ₹5,000. Current Ratio of a Company is 2.5 : 1. (B) 2.5 : 1 (A) 3.75 : 1 Ans.Operating Profit Ratio = 100 – Operating Ratio = 100- 88.34 = 11.66%. (ii)Trade receivables (bill receivables, debtors less provisions for doubtful debts). TEST YOUR UNDERSTANDING I • State which of the following statements are True or False. NCERT Solutions for Class 6, 7, 8, 9, 10, 11 and 12, Classification of Accounting Ratios (C) ₹1,80,000 (C) 7 Times Also, if credit sales are not specified, then total sales will be deemed to be on credit. 1.State with reason whether repayment of long-term loan will result in increase,decrease or no change of debt equity ratio. (B) 5 Trimes The current ratio after the payment will be : 28.From the following calculate the ‘gross profit ratio’ and ‘working capital turnover ratio’: (B) 23.2% Ans. (C) 1 : 2 What will be the amount of Gross Profit. (a)Current investments Students can solve NCERT Class 12 Accountancy Accounting Ratios MCQs Pdf with Answers to know their preparation level. (i)Debt equity ratio (C) ₹4,50,000 Opening Inventory ₹75,000; Closing Inventory ₹1,05,000; Inventory Turnover Ratio 6; Gross Profit 20% on cost; what will be Gross Profit? Effect Reduce (Delhi 2009) (D) ₹5,00,000, 106. (A) Cash and Bank Balance Its current liabilities are ?80,000. (C) Net Profit Ratio (a)Shareholders’ funds (i.e. If its Inventory is ₹52,000, what will be the liquid Ratio? (A) Sales efficiency (D) 5 times, 95. Credit Purchases ₹6,00,000; Trade Payables Turnover Ratio 5; Calculate closing creditors, if closing creditors are ? (a)Long-term borrowings (A) ₹45,000 State giving reasons, (for any four) which of the following would improve, reduce or not change the ratio (A) 70% (B) Liquidity Assuming that the current ratio is 2 : 1, Cash paid against Bills Payable would: (C) 6.67% 18.The debt equity ratio of a company is 1:1 state giving reasons, (any four) which of the following would improve, reduce or not change the ratio Current ratio will be (ii)Working capital, i.e. Practicing from the Objective Questions for 12th Class Accountancy helps you be prepared for the upcoming exams. 32. (ii) Current liabilities of a company are Rs 1,60,000. (A) ₹1,20,000 Cash Revenue from Operations ₹4,00,000 Credit Revenue, from Operations ₹21,00,000; Revenue from Operations Return ₹1,00,000; Cost of revenue from operations ₹19,20,000. (ii)Net profit ratio Net profit ratio shows the relationship between net profit and revenue from operations i.e. (B) 80% (D) 37 : 1, 65. Current ratio of a firm is 9 : 4. Commerce : NCERT Solution (Part - 1) ... Answer: Accounting ratios are classified in the following two ways. Answer. (A) 16% Accountancy MCQs for Class 12 Chapter Wise with Answers PDF Download was Prepared Based on Latest Exam Pattern. Subsequently, it purchased goods for ₹1,00,000 on credit. (D) 70% (D) Purchases – Closing Inventory, 109. Reason Purchase of goods on credit will increase the current liabilities, but the quick assets remain unchanged. Ans. (D) 1.6 : 1, 41. Save my name, email, and website in this browser for the next time I comment. Net Profit Ratio =Net Profit after Tax/Revenue from Operations i. e. Net Sales x 100 (A) 7 times Office expenses, administrative expenses, selling and distribution expenses, employees benefit expenses, depreciation and amortisation expenses. (D) 10 times, 98. A Company’s Current Ratio is 2.4 : 1 and Working Capital is ₹5,60,000. Reason Purchase of machinery for cash will decrease the quick assets, but the current liabilities remain unchanged. What is meant by ratio? (D) Credit purchase of Goods, 21. Revenue from Operations – Gross Profit. (A) 4% (Delhi 2013) Equity Share Capital ₹5,00,000; General Reserve ₹3,20,000; Preliminary Expenses ₹20,000; Debentures ₹3,20,000; Current Liabilities ₹80,000. Proprietary Ratio is : (i)Debt to Equity ratio It establishes the relationship between long-term debt (external equities) and the equity (internal equities) i.e. 34.From the following information, calculate any two of the following ratios or (B) 60% Revenue from operations (Sales) Rs 2,00,000, gross profit 25% on cost, inventory at the beginning is 1/3 of the inventory at the end which was 30% of sales. (B) Inventory Current Ratio will be : (B) 40% (D) Contingent Liabilities, 15. Trade Receivables Turnover Ratio will be : Proprietors’ Funds or Shareholders’ Funds 33. (b)Current Assets [Current investments + Inventories (including spare parts and loose tools) + Trade Receivables + Cash and Cash Equivalents + Short-term Loans and Advances + Other Current Assets] (D) ₹1,24,000, 75. (D) ₹1,80,000. (D) 46 Days, 89. Credit revenue from operations ₹6,00,000; Cash revenue from operations ? (b)Long-term provisions Effect Reduce Ans. T rade Receivables Turnover Ratio will be : (B) 25% Free PDF Download - Best collection of CBSE topper Notes, Important Questions, Sample papers and NCERT Solutions for CBSE Class 12 Accounts Accounting ratios. (B) ₹1,57,500 (C) Working Capital Ratio (iii)Other short-term liabilities. (B) 2.3 : 1 Fixed Assets ₹5,00,000; Current Assets ₹3,00,000; Equity Share Capital ₹4,00,000; Reserve ₹2,00,000; Long-term Debts ₹40,000. (C) 1 : 3 (D) ₹27,000, 87. Credit revenue from operations ₹3,00,000. 10,000 and the ‘Revenue from Operations’ are Rs. NCERT Solutions for Class 12 Accountancy Part II Chapter 5 Accounting Ratios. (B) Redemption of Debentures (f)Other current assets (prepaid expenses, interest receivable, etc.) (B) ₹1,25,000 Ans. (B) ₹1,00,000 (D) ₹1,10,000, 35. Working Capital turnover Ratio will be: Items Included in Long-term Debts It includes long-term borrowings and long-term provisions. (iv)Short-term loans and advances. (C) Solvency (a)Short-term borrowings (D) 2 : 1, 10. (D) All of the Above, 22. Average collection period is 3 months. (B) Quick Ratio (A) 29% (B) 2 : 1 (A) ₹1,50,000 (B) Short Term Debts/Equity Capital (ii) The current ratio of X Ltd is 2 : 1. Cost of Revenue from Operations i.e. Ans. (ii)Working capital turnover ratio Cost of Goods Sold (A) Long Term Debts/Shareholder’s Funds (iv)Sale of goods at a profit (D) 8.82 Times. Average Collection Period will be : Home >> Category >> Finance (MCQ) Questions and answers >> Ratio Analysis 1) Determine Debtors turnover ratio if, closing debtors is Rs 40,000, Cash sales is 25% of credit sales and excess of closing debtors over opening debtors is Rs 20,000. (A) Bills Receivable 23. Assuming that the current ratio is 2 : 1, purchase of goods on credit would: In the absence of opening creditors and bills payable, closing creditors and bills payable can be used in the above formula. On the basis of following data, the Debt-Equity Ratio of a Company will be: (B) 85% (i) Gross profit ratio Gross profit ratio shows the relationship between the gross profit to net sales (revenue from operations) (B) Activity (a)Fixed assets (tangible fixed assets, intangible fixed assets). However, we will notfi nd many absolute answers. Cost of Goods Sold = Cost of Materials Consumed + Purchases of Stock-in-trade + Change in Inventories of Finished Goods, Work-in-progress and Stock in-trade + Direct Expenses (ii)Purchase of goods on credit Ans. (B) Decrease Current ratio Closing Debtors will be : What we … Reason As there is a simultaneous increase and decrease in current asset, i.e. cost of goods sold is computed by adding cost of materials consumed, purchases of stock-in-trade, changes in inventories of finished goods, work-in-progress and stock-in-trade and direct expenses Opening Inventory ₹1,00,000; Closing Inventory ₹1,50,000; Purchases ₹6,00,000; Carriage ₹25,000; Wages ₹2,00,000. (D) 90%, 67. Liquid Ratio will be : (i) Net profit after interest but before tax Rs 1,40,000, 15% long-term debts Rs 4,00,000,shareholders’ funds Rs 2,40,000 and tax rate 50%. Inventory Turnover Ratio is 5 times. (A) Average Inventory/Revenue from Operations (i) Operating ratio      (ii) Inventory turnover ratio (iii) Proprietary ratio (D) 2 : 1, 6. (D) 6.2 Times, 71. A Company’s Current Ratio is 2.8 : 1; Current Liabilities are ₹2,00,000; Inventory is ₹1,50,000 and Prepaid Expenses are ₹10,000. (B) ₹60,000 (iv) Issue of bonus shares (D) 3 : 1, 19. Cost of revenue from operations ₹6,00,000; Inventory Turnover Ratio 5; Find out the value of opening inventory, if opening inventory is ₹8,000 less than ” the closing inventory. (B) 2.25 : 1 (B) 4 times A Company’s Current Assets are ₹6,00,000 and working capital is ₹2,00,000. All questions and answers from the Ts_grewal II_(2018) Book of Class 12 Commerce Accountancy Chapter 4 are provided here for you for free. (v)Redemption of debentures at a premium (All India 2011) (B) 6 times Profit Ratio is 20% of cost? (B) Long Term Debts 21.From the following information, calculate any two of the following ratios NCERT Solutions CBSE Sample Papers Accountancy Class 12 Accountancy. State with reason which of the following Ans. (C) 1.38 : 1 20.Assuming that the debt equity ratio is 2. = Revenue from Operations i.e. Questions can be asked from basics of accounting (which you have read in class – XI), basic terms, concept and conventions important journal entries, depreciation, errors and rectification, ratio analysis, cash flow analysis and the file that students prepare. MCQ Questions for Class 12 Accountancy with Answers were prepared based on the latest exam pattern. (A) 42 : 1 (C) 19% (D) ₹1,10,000, 96. Credit Purchases ₹9,60,000; Cash Purchases ₹6,40,000; Creditors ₹2,40,000; Bills Payable ₹80,000. (a)Non-current Assets [Fixed assets (Tangible and intangible assets) + Non-current Investments + Long-term Loans and Advances (C) ₹24,000 10.The debt-equity ratio of a company is 0.8:1. (A) 60% (C) As before (B) 65% (C) Bank Balance (Delhi 2010; All India 2010) Accounting ratios are widely used for such comparisons. ; Carriage ₹25,000 ; Wages ₹2,40,000 ; Carriage Inwards ₹1,50,000 ; creditors ₹50,000 Closing. Questions for Class 12 with Answers PDF Download was prepared Based on the Latest CBSE Books and.!, what will be the value of Inventory obtained by the best alternate check., 103 of ₹2,40,000 during the year ability to satisfy its Short term obligations as become! – operating ratio = 100 – operating ratio = 100- 88.34 = 11.66 % Approach is it! Ratios Liquidity Ratios measure the Profitability of a firm is measured by its to. ) ₹2,40,000 ( B ) ₹1,57,500 ( C ) Debt equity ratio will increase, decrease or not the!? 25,000 to a Trade payable ’ s Experts and students has answered all of Accounting Ratios Ratios. Ratio exceeds, it indicates risky financial position of the following Ratios ( i ) a firm. 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