Practice Financial Statement and Ratio Analysis Questions and Answers

• Match the following Ratios A)     Overall profitability ratio                       1) Gearing Ratio B)      Efficiency rati...
• Which of the following will be considered as debt while calculating the debt equity ratio of a company?
• Which of the following is NOT the feature of Discounted cash flow Analysis?
• The ratio of a firm’s property, plant, and equipment, net of accumulated depreciation, to its annual depreciation expense is an estimate of:
•   Which of the following ratios is very important to assess the eligibility of a borrower for a Term Loan?
• Which of the following statements are not true regarding the issuance of a bank guarantee? 1.    All bank guarantees have an expiry period a...
• Which of the following statements about Mortgage are not true? 1.    Under a mortgage, the legal ownership of the asset can be transferred to the lende...
• Given the following information: Revenue from Operations 3,40,000 Cost of Revenue from Operations 1,20,000 Selling expenses 80,000 Administrative Expen...
• Which of the following statement is true regarding standard costing?
• The PBT of a company is 2,00,000, preference dividend Rs.25,000, and taxes paid Rs.15,000. The number of equity shares is 1,00,000. The earnings per share ...
• If a firm has Net Profit of ₹1,20,000, Sales of ₹24,00,000 and Equity Shareholder's Fund of ₹6,00,000, what is the Return on Equity (ROE)?
• A company has Total Assets of ₹25,00,000 and Total Liabilities of ₹10,00,000. What is its Debt to Equity Ratio, if long-term debt is ₹5,00,000?
• A firm’s EBIT is ₹5,00,000. It pays ₹50,000 in interest and ₹1,20,000 in tax. What is the Interest Coverage Ratio?
• A firm reports the following: Sales = ₹40,00,000; Cost of Goods Sold = ₹28,00,000; Inventory = ₹7,00,000. What is the Inventory Turnover Ratio?
• A company has a Net Profit of ₹1,50,000 and Sales of ₹30,00,000. What is its Net Profit Margin?
• A firm’s Return on Equity (ROE) is 20%, and its equity capital is ₹10,00,000. What is the Net Profit?
• A firm has Cost of Goods Sold = ₹36,00,000 and Closing Inventory = ₹6,00,000. What is the Inventory Turnover Ratio, if opening and closing stock are eq...
• A company has the following details for the year: • Net Income = ₹12,00,000 • Preferred Dividends = ₹1,00,000 • Outstanding Shares (Common Stock)...
• A company has the following details for the year: • Net Income = ₹5,00,000 • Preferred Dividends = ₹50,000 • Outstanding Shares (Common Stock) = ...
• A company's Net Sales is ₹90,00,000 and its Debtors are ₹15,00,000. What is the Debtors Turnover Ratio?
• If the Operating Ratio of a firm is 80% and Net Sales are ₹200 lakh, what is the Operating Profit?
• A firm reports the following data over two years: Assuming no significant change in asset quality or liquidity structure, which of the following is the b...
• A firm has total assets of ₹200 lakhs, intangible assets worth ₹50 lakhs, current assets worth ₹60 lakhs, current liabilities of ₹40 lakhs, and tot...
• A holding company is required to prepare consolidated financial statements. The financials of which of the following will be includes in the consolidated f...
• All its JV IT Ltd has total current assets worth ₹9,00,000, of which inventory is ₹2,00,000. Current liabilities stand at ₹5,60,000. What will be its...
• GB Ltd is preparing its Cash Flow Statement. Which of the following will be recorded under the investing activity?
• Which of the following is not a source of funds for a company?
• Schedule III Part 2 of the Companies Act, 2013, pertains to the Format of ______?
• Calculate the EBIT of the company given the following details: Sales: ₹20,00,000  Cost of Goods Sold: ₹14,00,000  Operating Expenses: ₹3,00,000  I...
• Use Direct method to calculate the net cash from operations of the company given the following transactions?  Sales in the year: ₹6,50,000  Cash receiv...
• Based on the below information, calculate the net cash flow of the company from operating activities?  Net Profit = ₹1,80,000  Depreciation = ₹40,000...
• A company is required to disclose the details of shareholders holding shares above a certain threshold in its financial statements. What is this threshold?...
• SDF Ltd recorded Net Sales of ₹10,00,000 during the year. Its Gross Profit was ₹2,50,000. If the inventory of the company at the end of the year was �...
• VG Ltd shared the following details from its Balance sheet at the end of the year. What is its Current Ratio?  ...
• GH Ltd took a term loan of Rs.24 crore for a period of 20 years to be repaid in equal annual instalments. The interest is 10% p.a. on reducing balance. The...
• A company has a Debt-to-Equity ratio of 2:1. It purchases a new plant for ₹5,00,000, financing it entirely by taking a long-term loan. What will be the n...
• Given: Net Profit ₹4,00,000; Tax Rate 30%; Equity Share Capital ₹10,00,000 (Face Value ₹10). The Return on Equity (ROE) is:
• The ratio that measures the efficiency with which a firm utilizes its assets to generate sales is:
• If you want to understand the financial performance of a company over a specific accounting period, which of the following financial statement will be usef...
• An entity, other than a financial institution, receives the dividends from the shares it owns in certain companies. The entity, while preparing its cash fl...