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#### Ratio Analysis Book Back Questions

12th Standard EM

Reg.No. :
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Accountancy

Time : 00:45:00 Hrs
Total Marks : 30
5 x 1 = 5
1. The mathematical expression that provides a measure of the relationship between two figures is called

(a)

Conclusion

(b)

Ratio

(c)

Model

(d)

Decision

2. Proportion of share holder's funds to total assets is called

(a)

Proprietary ratio

(b)

Capital gearing ratio

(c)

Debt equity ratio

(d)

Current ratio

3. Which one of the following is not correctly matched?

(a)

Liquid ratio – Proportion

(b)

Gross profit ratio – Percentage

(c)

Fixed assets turnover ratio – Percentage

(d)

Debt-equity ratio – Proportion

4. Current liabilities Rs. 40,000; Current assets Rs. 1,00,000 ; Inventory Rs. 20,000. Quick ratio is

(a)

1:1

(b)

2.5:1

(c)

2:1

(d)

1:2

5. Cost of revenue from operations Rs. 3,00,000; Inventory in the beginning of the year Rs. 60,000; Inventory at the close of the year Rs. 40,000. Inventory turnover ratio is

(a)

2 times

(b)

3 times

(c)

6 times

(d)

8 times

6. 3 x 2 = 6
7. What does return on investment ratio indicate?

8. State any two limitations of ratio analysis.

9. From the following information, calculate debt equity ratio:

Balance sheet (Extract) as on 31.03.2018
Particulars Rs.
I EQUITY AND LIABILITIES
1. Shareholders' funds
(a) Share capital
Equity share capital 1,00,000
(b) Reserves and surplus 60,000
2. Non-current liabilities
Long-term borrowings (Debentures) 80,000
3. Current liabilities
(a) Trade payables 50,000
(b) Other current liabilities
Outstanding expenses 30,000
Total 3,20,000
10. 3 x 3 = 9
11. Explain the objectives of ratio analysis.

12. What is inventory conversion period? How is it calculated?

13. How is operating profit ascertained?

14. 2 x 5 = 10
15. Calculate quick ratio: Total current liabilities Rs. 2,40,000; Total current assets Rs. 4,50,000; Inventories Rs. 70,000; Prepaid expenses Rs. 20,000.

16. Following is the balance sheet of Lakshmi Ltd. as on 31st March, 2019:

Particulars Rs.
I EQUITY AND LIABILITIES
1. Shareholders’ funds
Equity share capital 4,00,000
2. Non-current liabilities 2,00,000
Long term borrowings
3. Current liabilities
(a) Short-term borrowings 50,000
(b) Trade payables 3,10,000
(c) Other current liabilities
Expenses payable 15,000
(d) Short-term provisions 25,000
Total 10,00,000
II ASSETS
1. Non-current assets
(a) Fixed assets 4,00,000
Tangible assets
2. Current assets
(a) Inventories 1,60,000
(b) Trade debtors 3,20,000
(c) Cash and cash equivalents 80,000
(d) Other current assets
Prepaid expenses 40,000
Total 10,00,000

Calculate:
(i) Current ratio
(ii) Quick ratio