CBSE Class 12 Accountancy Analysis of Financial Statements Assignment

Important Questions for NCERT Class 11 Accountancy Financial Statements

Question  . Rent paid on 1st October, 2020 for one year upto 30th September, 2020 was Rs.2,400. Rent paid on 1st October, 2020 for the year upto 30th September, 2020 was Rs.3,200. Rent shown in the Profit and Loss Account for the year ended on 31st December, 2020, would be :
(a) Rs.6,000
(b) Rs.3,200
(c) Rs.3,000
(d) Rs.2,600

Answer :  D

Question  . Accrued income is :
(a) A Liability
(b) Revenue
(c) An Asset
(d) An Expense

Answer :  C

Question Revenue Income is transferred to
(a) Profit and Loss Account.
(b) Trading and Profit and Loss Account.
(c) Balance Sheet.
(d) Miscellaneous Income.

Answer :  B

Question  Capital Expenditure is included in
(a) Trading Account.
(b) Profit and Loss Account.
(c) Balance Sheet.
(d) Profit and Loss Appropriation Account.

Answer :  C

Question  . A new firm commenced business on 1st January, 2020 and purchased goods costing Rs.90,000 during the year. A sum of Rs.6,000 was spent on freight inward. At the end of the year the cost of goods still unsold was Rs. 15,000 (Realisable Value 12,000). Sales during the year was Rs. 1,20,000. What is the gross profit earned by the firm?
(a) Rs.42,000
(b) Rs.30,000
(c) Rs.36,000
(d) Rs.39,000

Answer :  A

Question  . Income tax paid by a sole trader is reflected in his financial statements :
(a) On the debit side of the Trading Account
(b) On the debit side of the Profit and Loss Account
(c) As an asset in the Balance Sheet
(d) As way of deduction from capital in the Balance Sheet

Answer :  D

Question  . Which of the following statements is correct:
(a) King’s International — P & L A/c as on 31st March, 2020
(b) King’s International — P & L A/c for the year ended 31st March 2020
(c) King’s International — P & L A/c for the year ended 31st March, 2020
(d) King’s International — P & L A/c for the current year (2019-2020)

Answer :  C

Question  . If closing stock appears in Trial Balance then it will be appearing in ;
(d) Trading Account
(b) Balance Sheet
(c) Profit & Loss Account
(d) Trading A/c & Balance Sheet

Answer :  B

Question  Capital Receipts are shown in
(a) Balance Sheet.
(b) Trading Account.
(c) Trading Account.
(d) Capital Account.

Answer :  A

Question . The purpose of preparing final accounts is to ascertain :
(A) Profit or loss
(B) Capital
(C) The value of assets
(D) Profit or loss and financial position

Answer :  D

Question  Closing Stock is valued at Cost or Net Realisable Value (Market Value), whichever is less because of
(a) Going Concern Concept.
(b) Accrual Concept.
(c) Prudence Concept.
(d) Consistency Concept.

Answer :  C

Question  Loss on sale of an old car is debited to
(a) Profit and Loss A/c.
(b) Car A/c.
(c) Depreciation A/c.
(d) Trading Account.

Answer :  A

Question  Closing Stock, if given outside the Trial Balance, is shown in
(a) Trading Account and Balance Sheet.
(b) Profit and Loss Account.
(c) Profit and Loss Account and Balance Sheet.
(d) Balance Sheet.

Answer :  A

Question  Sales are equal to
(a) Cost of Goods Sold + Gross Profit.
(b) Cost of Goods Sold — Gross Profit,
(c) Gross Profit — Cost of Goods Sold.
(d) Purchases + Gross Profit.

Answer :  A

Question  Income tax paid by a sole trader is shown
(a) on the debit side of the Trading Account.
(b) on the debit side of the Profit and Loss Account.
(c) as deduction from capital in the Balance Sheet.
(d) as addition to capital in the Balance Sheet.

Answer :  C

More Important Questions for NCERT Class 11 Accountancy Financial Statements

Question. List any two information required to be given in the balance sheet of a company or by way of foot Notes.
Answer : (i) Uncalled Liability on share partly paid up .
(ii) Arrears of fixed Cumulative Dividend.

Question. Name two tools of Financial Analysis ?
Answer : (i) Comparative Financial Statements.
(ii) Ratio Analysis etc.

Question. Give the heading under which the following items will be shown in a company’s Balance sheet:
(i) Goodwill.
(ii) Preliminary Expenses
(iii) Loose Tools
(iv) Capital Redemption Resave.
(v) Live Stock.
Answer : (i) Fixed Assets.
(ii) Miscellaneous Expenditures
(iii)Current Assets Loans & Advance under Current Assets.
(iv)Reserve and Surplus.
(v)Fixed Assets.

Question. Give two example each of Non-Current Assets and Non- Current Liabilities.
Answer : Non-Current Assets – Building, Machinery.
Non-Current Liabilities – Share Capital , Debentures.

Question. Give the format of the Balance sheet of a company(main headings only) as per the requirement of Schedule VI of the companies Act.1956.
Answer : Balance sheet as on______

Liabilities Rs.                                               Assets Rs.

Share capital                                               Fixed Assets
Reserve & surplus                                        Investment
Secured Loans                                             Current Assets,
Unsecured Loans                                         Loan and Advances
                                                                 (a) Current Assets
                                                                 (b) Loans & Advance
Current Liabilities & Provision                       Miscellaneous Expenditures
(a) Current Liabilities                                   Profit & Loss amount (Dr.Balance)
(b) Provision

Question. What is Vertical Analysis?
Answer : The Analysis which is made to review the financial statements of one particular year only is called Vertical Analysis.

Question. Prepare Comparative income statement from the following information for the years ended march 
31,2003 and 2004.

Answer : Percentage Change –
Net sale 25%
Cost of Goods sold 25%
Gross profit 25%
Indirect Expenses 87.50%
Net profit before Tax 18.05%
Income Tax 41.67%
Net Profit after Tax 5.56%

Question. List any three items that can be shown as contingent Liabilities in a company’s Balance sheet.
Answer : (i) Claims against the Company not acknowledged as debts .
(ii) Uncalled Liability on partly paid shares.
(iii)Arrears of Dividend on Cumulative preference shares.

Question. State whether the Balance sheet of a Company is prepared ’ as on a particular date ‘ or ‘ as at a Particular date ‘ ?
Answer : Balance of a Company is prepared ‘ as at a particular date ‘.

Question. State any two items which are shown under the head ‘Investment’ in a company balance sheet.
Answer : (i) Government Securities.
(ii) Sinking Fund Investment.

Question. What is the interest of Shareholders in the analysis of Financial statements?
Answer : (i) They want to judge the present and future earning capacity of the business.
(ii) They want to judge the safety of their investment.

Question. Which item is assumed to be 100 in the case of common size Income statement .
Answer : Sales.

Question. Give the example of Vertical Analysis?
Answer : Ratio Analysis.

Question. The following balance have been from the book of Sahara Ltd. Share capital Rs.10,00,000, securities Premium Rs. 1,00,000, 9% Debentures Rs. 500,000, Creditors Rs. 200,000., Proposed Dividend Rs. 50,000. , Freehold property RS. 9,00,000, share of Reliance Industries Rs. 4,00,000, Work-in- Progress Rs. 4,00,000, Discount on Issue of Debentures Rs. 1,00,000. Prepare the balance sheet of the company as per schedule VI part 1 of the companies Act.1956.
Answer : Total of Balance Sheet Rs.18,50,000.

Question. What is Horizontal Analysis?
Answer : The analysis which is made to review and compare the financial statements of two or more then two Years is called Horizontal Analysis.

Question. How will you show the following items in the Balance sheet of a company.
(i) Calls in Arrears
(ii) Calls in Advance.
Answer : (i) Calls in Arrears: It is deducted from the subscribed capital.
(iii) Calls in Advance: It is shown separately under the subscribed capital.

Question. Under what heads the following items on the Liabilities side of the Balance sheet Of a company will be presented
(i) Proposed Dividend.
(ii) Unclaimed Dividend.
Answer : Items                  Heading                      Sub-Heading
  
Proposed dividend             Current Liabilities            Provision
                                          & Provision
Unclaimed dividend           Current Liabilities            Current Liabilities
                                          & Provision

Question. Give the example of Horizontal Analysis.
Answer : Comparative Financial Statement.

Question. How is a Company’s balance sheet different from that of a Partnership firm? Give Two point only.
Answer : (i) For company’s Balance Sheet there are two standard forms prescribed under the companies Act.1956 Whereas there is no standard form prescribed under the Indian partnership Act,1932 for a partnership Firms balance sheet.
(ii) In case of a company’s Balance sheet previous years figures are required to be given whereas it is not so in the case of a partnership firms balance sheet.

Question. How is analysis of Financial statements suffered from the limitation of window dressing ?
Answer : Analysis of financial statements is affected from the limitation of window dressing as companies hide Some vital information or show items at incorrect value to portray better profitability and financial Position of the business, for example the company may overvalue closing stock to show higher profits.

Please refer to attached file for CBSE Class 12 Accountancy Analysis of Financial Statements Assignment