CBSE Class 12 Accountancy MCQ Questions of Financial Statements Analysis with Answers available here. MCQ Questions for Class 12 Accountancy with Answers were Prepared Based on Latest Exam Pattern. Students can solve Class 12 Accountancy Financial Statements Analysis MCQ Questions with Answers to realize their preparation level. 

Various Choice Questions for a significant part of exams for Class 12 Accountancy and whenever practiced appropriately can assist you with getting better marks. Every one of the Multiple choice questions has been given arrangements and has been arranged depending on the normal example in forthcoming board tests. This might help you to comprehend and check your insight about the chapters.

1. Interpretation of Financial Statements includes:

(a) Criticisms and Analysis
(b) Comparison and Trend Study
(c) Drawing Conclusion
(d) All the above

2. Horizontal Analysis is also known as :

(a) Dynamic Analysis
(b) Structural Analysis
(c) Static Analysis
(d) None of these

3. Vertical Analysis is also known as :

(a) Static Analysis
(b) Dynamic Analysis
(c) Structural Analysis
(d) None of these

4. Comparative Statements are also known as :

(a) Dynamic Analysis
(b) Horizontal Analysis
(c) Vertical Analysis
(d) External Analysis

5. Common-size Statement are also known as:

(a) Dynamic Analysis
(b) Horizontal Analysis
(c) Vertical Analysis
(d) External Analysis

6. The most commonly used tools for financial analysis are:

(a) Comparative Statements
(b) Common-size Statement
(c) Accounting Ratios
(d) All the above

7. Which of the following is not an objective of Analysis of Financial Statements?

a) To judge the financial health of the firm
b) To judge the short term and long term liquidity position of the firm
c) To judge the reasons for the change in the profitability of the firm
d) To judge the variations in the accounting practices of the business followed by different enterprises

8. From financial statement analysis, the creditors are interested to know

a) Liquidity
b) Profit
c) Efficiencies
d) Share Capital

9. Feature of financial analysis is to present the data contained in financial
statement in

a) Easy form
b) Convenient and rational groups
c) Comparable form
d) All of the above

10. Which analysis is considered as dynamic?

a) Horizontal Analysis
b) Vertical Analysis
c) Internal Analysis
d) External Analysis

11. Financial Analysis is significant for

a) Employees
b) Creditors
c) Management
d) All of these

12. Who among the following is not an external user of the financial statement
analysis?

a) Shareholders
b) Debenture holders
c) Creditors
d) Management

13. Which of the following is not a tool of financial statement analysis?

(i) Cash Flow Statement
(ii) Statement showing distribution of dividend
(iii) Ratio Analysis
(iv) Comparative Financial Statements

14. The financial statements of a business enterprise include :

(i) Balance sheet
(ii) Statement of Profit and loss account
(iii) Cash flow statement
(iv) All the above

15. Vertical Analysis is also known as :

(i) Static Analysis
(ii) Dynamic Analysis
(iii) Structural Analysis
(iv) None of these

16. Which of the following is not recognized as tool for the analysis of financial statements?

(i) Cash Flow Statement
(ii) Funds Flow Statement
(iii) Trend Analysis
(iv) Statement showing distribution of dividends

17. When financial statements of several years are analyzed, it is termed as

(i) None of the options
(ii) Horizontal analysis
(iii) Current ratios
(iv) Vertical analysis

18. Comparative Statements are also known as :

(i) Dynamic Analysis
(ii) Horizontal Analysis
(iii) Vertical Analysis
(iv) External Analysis

19. Financial Statement Analysis Objectives/Need is

a) All of the options

b) Measure the profitability of the business

c) Measure the financial strength of the business

d) Make comparative study within the firm and with other forms

20. Significance or Importance of Financial Analysis is

a) All of the options

b) To know the profitability Condition

c) To know the liquidity Condition

d) To know the solvency Condition

21. To whom Importance of Financial Analysis is

a) All of the options

b) For Management

c) For Investors

d) For Creditors

22. Which is Types of financial Analysis

a) Horizontal Analysis and Vertical Analysis

b) Horizontal Analysis

c) Vertical Analysis

d) None of the options

23. Horizontal Analysis is also known as

a) Dynamic Analyses

b) Vertical Analysis

c) Dynamic Analyses and Vertical Analysis

d) None of the options

24. In which analysis Financial Statement for a single year analysed

a) Vertical Analysis

b) Dynamic Analyses

c) Vertical Analysis and Dynamic Analyses

d) None of the options

25. Tool of Financial Analysis is

a) Comparative Statement and Common Size Statement

b) Comparative Statement

c) Common Size Statement

d) None of the options

Answer:

1. Answer (d) All the above

2. Answer (a) Dynamic Analysis

3. Answer (a) Static Analysis

4. Answer (b) Horizontal Analysis

5. Answer (c) Vertical Analysis

6. Answer (d) All the above

7. Answer (d) To judge the variations in the accounting practices of the business followed by different enterprises

8. Answer (a) Liquidity

9. Answer (d) All of the above

10. Answer (a) Horizontal Analysis

11. Answer (d) All of these

12. Answer (d) Management

13. Answer (ii) Statement showing distribution of dividend

14. Answer (iv) All of the above

15. Answer (i) Static Analysis

16. Answer (iv) Statement showing distribution of dividends

17. Answer (iv) Vertical analysis

18. Answer (ii) Horizontal Analysis

19. Answer (a) All of the options

20. Answer (a) All of the options

21. Answer (a) All of the options

22. Answer (a) Horizontal Analysis and Vertical Analysis

23. Answer (a) Dynamic Analyses

24. Answer (a) Vertical Analysis

25. Answer (a) Comparative Statement and Common Size Statement