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#### Ratio Analysis Two Marks Questions

12th Standard EM

Reg.No. :
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Accountancy

Time : 00:45:00 Hrs
Total Marks : 20
10 x 2 = 20
1. What is quick ratio?

2. What is meant by debt equity ratio?

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

Particulars Rs.
I EQUITY AND LIABILITIES
1. Shareholders’ funds
Equity share capital 2,00,000
2. Non-current liabilities
Long term borrowings 50,000
3. Current liabilities
(a) Short-term borrowings 17,000
(c) Other current liabilities
Expenses payable 3,000
(d) Short-term provisions 5,000
Total 3,00,000
II ASSETS Rs.
1. Non-current assets
Fixed assets
(a) Tangible assets 1,50,000
(c) Cash and cash equivalents 30,000
(d) Other current assets
Prepaid expenses 5,000
Total 3,00,000

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

4. From the following information calculate capital gearing ratio:

Balance Sheet (Extract) as on 31.03.2018
Particulars Rs.
I EQUITY AND LIABILITIES
1. Shareholders' funds
(a) Share capital
Equity share capital 2,00,000
6% Preference share capital 1,00,000
(b) Reserves and surplus
General reserve 1,25,000
Surplus 75,000
2. Non-current liabilities
Long-term borrowings (8% Debentures) 2,00,000
3. Current liabilities
Provision for tax 50,000
Total 9,00,000
5. Definition of ratio analysis.

6. What is Liquidity ratios?

7. What is turnover ratios?

8. Quick ratio of a company is 1.5: 1.State giving reason, whether the ratio will improve, decline or not change on payment of divided by the company.

9. Why should the inventory turnover ratio be more important when analysing a grocery store than an insurance company?

10. The liquidity of a business firm is measured by its ability to satisfy its long-term obligations as they become due. Comments.