Accounting ratio are calculated from financial statements which are drawn on the basis of historical costs as recorded in the books of accounts. Thus. these ratios ignore the change in price level and they do not reflect the actual analysis.

Turnover ratios show how efficiently assets or other items have been used to generate revenue from operations. They are also called as activity ratios or efficiency ratios.
The important turnover or activity ratios are:
(i) Inventory turnover ratio
(ii) Trade receivables turnover ratio
(iii) Trade payables turnover ratio
(iv) Fixed assets turnover ratio

(i) A Management Information System (MIS) is a system that provides information for decision making at all levels of management.
(ii) It includes manufacturing information system, marketing information system, human resource information system and accounting information system.

(i) In the case of over subscription, the shares are allotted to the public with certain number lesser than the number of shares they applied for, in certain basis.
(ii) It is called pro - rata allotment.

Yes, financial statement analysis is a post-mortem of the business transactions as it assesses the operational ability, profitability and financial soundness of the business.

Funds flow analysis is concerned with preparation of funds flow statement which shows the inflow and outflow of funds in a given period of time. Funds flow analysis is useful in judging the credit worthiness, financial planning and preparation of budgets.

It is so because receipts and payments account is prepared on cash basis of accounting

If the retiring partner is not paid fully immediately on retirement, then the remaining balance of his capital account will be transferred to his loan account and will be shown as his loan on the liabilities side . of the balance sheet of the firm

Interest on partner's capital and interest on drawings are an appropriation of profit and not a charge on profit and hence is recorded through profit and loss appropriation account instead of profit and loss account

Revaluation account will be debited. Increase in bills payable is a loss for the firm. Being a nominal account, to record this loss, revaluation account will have to be debited.

No, due to legal restrictions, a company cannot maintain its accounts under single entry system.

A person who is retired from the firm is known as an outgoing partners or retiring partners.

(a) Under fixed capital method, salary payable to a partner is recorded in the current account
(b) Under fixed capital method, drawings made by a partner is recorded in the current account.

If the firm enjoys good reputations for its product's quality, there will be higher sales and the value of its goodwill will increase.

(i) These are the amount received by not-for-profit organizations as a gift. It may be a general donation or specific donation.
(ii) General donation: If the donation is received without any specific condition, then it is a general donation. It is a revenue receipt.
(iii) Specific donation: If the donation received with a specific condition particular purpose like donations for sports fund, prize fund, etc., It is known as a specific donation. It is a capital receipt.