Class XII Accountancy Statement

Chapter 1 Accounting of partnership

firm-Fundamental

1. Indian Partnership Act has been passed in the year 1932.

2. Partnership is a relation between persons who have agree to share the profit of business
carried on by all or any of them acting for all.
3. Partnership deed means rules and condition of partnership business.
4. When the new partner brings premium (Goodwill )in cash ,it is transferred through
premium account.
5. Partnership is the outcome of agreement between partners.
6. Partner's current accounts are prepared only when partner's Capitals are fixed.
7. Each partner is an agent of the firm and principal of the firm.
8. The liability of the partners in the firm is unlimited.
9. The registration of partnership is not compulsory.
10. Current account is opened in Fixed capital method.
11. Maximum number of members in a banking firm should be 50.
12. Ratio of sharing profits and losses is equal but capitals brought by partners are not
equal.
13. capitals are equal but the ratio of sharing profits and losses is not equal.
14. Investment of capital increases the profit earning capacity like other
15. The partnership originates from contract.
16. Sleeping partners are those who do not take any part in the conduct of the business but
provide capital and share profits and losses in the agreed ratio.
17. The relation of partner with the firm is that of an owner or Principal and an agent.
18. Two is the minimum number of persons to firm a Partnership.
19. Only individuals can become a partners in the firm.
20. Each partner must be competent to contract /agreement.
21. Partner's current accounts are not prepared in the case of fluctuating capital method.
22. Interest on capital ( if payable) can be paid only when the firm has earned profit.
23. Interest on additional capital brought a partner is payable @ 6% per annum in the
absence of partnership deed.
24. In partner's current accounts interest on partner's capital enterned in the case of fixed
capital method.
25. A firm can pay interest on partner's capital, when it has profit.
26. Partner's salaries bonus interest drawings Commission profits etc are entered in
partner's current accounts in fixed capital method.
27. If a partner take a loan from the firm a separate loan account is opened.
28. Income Tax paid by partnership firm is a business expense and it is therefore,debited to
profit and loss account.
29. Profit and Loss appropriation account is a nominal account.
30. Sharing of Profit is not compulsory for partnership.
31. Goodwill is said to be a fixed asset.
32. The type of asset ,Goodwill is intangible fixed.
 Teacher's Name
Sadhana Bachani

Chapter 2.
Reconstitution of partnership firm

33. Revaluation account is opened on admission of a new partner.

34. The equation of sacrificing ratio is
old ratio-new ratio.
35. Depreciation on Goodwill is not at all charged.
36. Super profit is called excess of actual profit over normal profit.
37. Goodwill is the benefit and the advantage of a good name or reputation of a business.
38. Cat Goodwill fatches highest value.
39. Goodwill is that fixed asset which is helpful in earning profit.
40. Average profit is the simple mean of actual profit of past few years.
41. The real value of goodwill can be obtained on the sale of business.
42. Increase in value of assests due to revaluation is recorded in credit side of revaluation
account.
43. Profit on revaluation is transferred in credit side of capital account.
44. Undistributed profit given in liabilities side of balance sheet is credited in partners capital
account.
45. Amount of the goodwill brought by the new partner is credited to all partners capital
account in sacrificing ratio.
46. Reduction in reserve for bad and doubtful debts will be credited to revaluation account.
47. The right over the amount of goodwill rests with old partners.
48. Decrease in liability is profit for a firm.
49. Reconstitution of a partnership is a change in relationship among the partnership.
50. Gaining ratio is equal to new ratio - old ratio.
Teacher's Name
Sadhana Bachani

Chapter 3. Admission of a partner

51. Cash account is debited and premium account is credited when a new partner brings
Goodwill in cash.
52. When GoodWill already exist in the books of the firm at the time of admission of a new
partner, it should be written off.
53. Premium is distributed to old partners in their sacrificing ratio.
54. Undistributed Profit shown in the balance sheet at the time of New partners admission is
distributed to old partners in their old ratio.
55. Decrease in liabilities is a profit.
56. The partner whose new share is reduced in comparison to his old share is called
sacrificing partner.
57. The partner whose new share is increased in comparison to his old share is called the
gaining partner.
58. No, new partner can be hold responsible for the losses incurred in the firm before his
admission.
59. If Goodwill account is opened ,it is shown in balance sheet.
60. Goodwill is a saleable assets.
61 . Due to raise capital, need of a skillful partner ,on death of a partner admission is given
to a new partner.
62. On paying the goodwill premium by new partner, it is transferred to all partner’s capital
account in their sacrificing ratio.

Teacher's Name
Sadhana Bachani

Chapter 4 Retirement / Death of a partner

63. When a partner retires from a firm his relationship with the firm as partner comes to an
end.
64. Profit is the basis of valuation of goodwill.
65. Right to share in firm's property is the right of a new partner.
66. Right to share in firm's profits is a right of a new partner.
67. Sacrificing ratio is equal to old ratio minus new ratio.
68. Gaining ratio is equals to new ratio minus old ratio.
69. Revaluation account is a nominal account.
70. Revaluation of decrease in the value of assets is- debit revaluation account.
71. Revaluation of increase in the value of a asset- credit revaluation account.
72. revaluation of increase in value of liability -debit revaluation account .
73. Revaluation of decrease in the value of liability- credit revaluation account .
74. Revaluation of recording unrecorded liability- debit revaluation account .
75. Revaluation of recording unrecorded assests- credit revaluation account .
76. Revaluation of profit on revaluation on the whole -debit revaluation account .
77. Revaluation of loss on revaluation on the whole- credited evaluation account.
78. When a new partner brings the amount of premium (goodwill) and gas it is credited to
premium Goodwill account.
79. Revaluation account is prepared on admission of new partner.
80. When new partner brings his share of goodwill in cash the amount is debited to capital
account of old partner.
81. When old ratio is deducted from new ratio it is called gaining ratio.
82. Undistributed losses and reserves are transferred to capital account of partners.
83. On admission of a new partners the difference of old and new ratio of old partners is
called sacrificing ratio
84. When change figures of Assets and liabilities are not shown in the book then
memorandum revaluation account is opened.
85. Only admission of new partner revaluation account is opened.
86. Revaluation account is transferred to Capital accounts of old partners.
87. When a new partner brings premium in cash it is distributed to old partners in their
sacrificing ratio.
88. A new partner has to pay capital to acquire his share in the Assets of the firm.
89. This share of new partner in the firm is decided by agreement by existing partners.
90. The undistributed profit appearing and balance sheet on admission of new partner is
credited to old partners capital account in their old profit sharing ratio.
91. The profit on revaluation of assets is credited to all partners capital account in their old
profit sharing ratio.
92. Goodwill valued on reconstitution of firm should not be shown in firms balance sheet.
93. If the new partner does not bring Goodwill in cash it is adjusted in capital accounts of
old partners by crediting in their sacrificing ratio and debiting new partners capital account.
94. The new partners is not at all concerned with the profit or loss on revolution of assets on
his admission.
95. Profit on Revolution is credited to old partners capital account in their old profit sharing
ratio.
96. The profit and loss on revaluation of assests and re- assessment of liabilities of the firm
on the retirement /death of a partner is transferred to the capital accounts of all partners
including retired /deceased partner.
97. Expulsion of a partner is made when he commits any act contrary to partnership
agreement.
98. When nothing otherwise is mentioned, the share of retiring partner will be distributed to
remaining partners in the mutual ratio of the remaining partners.
99. Undistributed loss on the retirement of a partner will be shared by all partners including
retiring partners.
100. If good will account is raised on retirement of a partner it will be debited to remaining
partner capital accounts in gaining ratio, debit ratio.
101. At the time of retirement loss on revelation is debited to all partners capital account.
102. By gaining ratio there is an increase in the ratio of remaining partner.
103. Life Insurance reserve fund is transferred to partners capital accounts.
104. The full amount of partners join life policy is received on the death of one partner .
105. The amount due to deceased partner is paid to his legal representative.
106. A ,B and C are partners in 3 : 2 : 1 respectively the new ratio of a and c will be 3 :2 (Ans
3:1)
107. Retirement is ceasing to be a partner ,expulsion is removal of a partner and death
means and of life of a partner.
108. Gaining ratio is the ratio in which continuing (remaining) partners gain from the share of
retiring partner.
109. New ratio - old ratio =gaining ratio.
110. Profit or loss of revaluation account is distributed to all partner's capital accounts.
111. If partnership is at wil,l a partner can retire from the firm by giving notice to remaining
partners.
112. Share of hidden Goodwill should be credited to the retiring partners capital account.
113. On the of a partner the amount due to be paid to be deceased partner is transferred to
his executor executor account.
114. After the retirement of a partner the remaining partners may continue partnership.
115. When the firm has no sufficient amount in cash it can pay the amount due to the retiring
partners by installments.
116. Retired partner cannot be held responsible for any act done by the firm after the date of
such retirement.
117. On retirement of a partner profit and loss adjustment account is opened.
118. Profit and loss adjustment account is transferred to Capital accounts of all partners.
119.In Annuity suspense account the amount due to a deceased/ retired partner is
transferred when payment is to be made by annuity method.
120 . To legal representative the amount due to a deceased partner is Paid.
121. As loan the amount due to deceased/ retired partner is shown when it is not paid in
case.
122. Share of retiring partner in hidden Goodwill of the firm must be credited to his capital
account on a retirement.
123. Interest on drawings is firm's income.
124. Indian Partnership Act 1932( Section 4)
125. According to Section 39 of the Indian Partnership Act 1932 resolution of firms means is
solution of partnership among all the partners.

Teacher's Name
Sadhana Bachani

Chapter 5 Dissolution of Partnership Firm

126. On dissolution of the firm, its Assets and liabilities are transferred to realisation
account.
127. Sale process of unrecorded is recorded in realisation account.
128. Realisation account is a nominal account.
129. The balance of profit and loss account of the firm under the dissolution is transferred to
partners capital accounts.
130. Cash account is not transferred to realisation account.
131. At the time of dissolution the bank overdraft account is transferred to realisation
account.
132. Undistributed losses and reserves are transferred to capital account of partners.
133. On dissolution the Assets of the firm are transferred to realisation account that their
book value..
134. Expenses incurrd on realisation of assets are charged to realisation account.
135. The result of realisation is transferred to all partners in their profit sharing ratio.
136. The court can order to dissolve the firm if the business of the form cannot be carried on
except at a loss.
137. After dissolution of the firm partner can transact your own business.
138. Payment of unrecorded liability debit realisation account.
139. Debit balance of capital account brings sufficient amount.
140. Individual liability of a partner is personal asset.
141. On dissolution of firm the existence of firm is ceased.
142. In certain circumstances the court may order dissolution of a firm .
143. All the books of accounts of the firm a closed in case of dissolution of a firm
144. The court generally does not interfere in the dissolution of a firm.
145. Realisation account is opened only once in the life of a firm.
146. The existence of a firm sees on the resolution of a firm
147. A firm does not dissolve automatically On The dissolution of partnership.
148. Compulsory dissolution is the consequence of insolvency of all partners of a firm accept
one partner
149. A partner can file a petition to the court for dissolution of a firm .
150. All books of accounts are closed on the resolution of a firm.
151. External liabilities payment is given first priority out the Assets of the dissolved firm .
152. The amount of journal reserve appearing in the balance sheet of a dissolve form is
transferred to Capital accounts of partners.
153. As a result of dissolution of firm the firm ceases to exists forever.
154. In profit sharing ratio the loss on realisation will be borne by partners of dissolved firm .
155. Loss on realisation is distributed among partners in their capital ratio.
156. The Assets of a dissolved firm are written in realisation account on market value.
157. The capital account of a partner is debited when he takes over any asset of a dissolved
firm.
158. The private asset of a partner can be used first to pay his private liability.
159. The capital account of a partner is credited when he under takes to pay the liability of
for dissolved firm.
160. When unrecorded asset is taken over by a partner it is shown in credit side of
realization account.
161. When are recorded liabilities are paid it is shown in debit side of realisation account
162. General reserves is an internal liability.
163. Realisation account is prepared on dissolution of firm.
164. At the time of dissolution of a firm bank overdraft is transferred to realisation account.

Teacher's Name
Sadhana Bachani
Chapter 6 Accounting of Share Capital
-issue of shares

165. Owners of company are

shareholders.
166. The balance of security Premium reserve is showed on Equity and Liabilities side of the
Balance sheet.
167. On calls arrears according to article A ,interest of 10%.may be charged per annum.
168. On calls paid in advance interest may be charged and according to article A is
12 %.p.a.
169. Shares on which intrest and repayment of money is paid after preference shares are
equity shares.
170. Authorised capital is the capital beyond which a company cannot issues share.
171. Over subscription is issued when excess application is received than the share.
172. Minimum subscription is a part of a issued capital without receipt ,a public limited
company cannot issue shares.
173. For non payment of call amount shares can be forfeited.
174. Balance of share forfeited account is transferred to Capital Reserve.
175. Written notice regarding forfeiture of shares should be given to the shareholder before
14 days.
176. Part of issued capital called from shareholder only on the liquidation of a company is
Reserve capital.
177. The difference between two calls is
of one month
178. Before the forfeiture of share company most serve or notice to share holders before 14
days.
179. When the company is being liquidated ,a part of issued capital is demanded from
shareholders it is called Reserve capital.
180. Capital Reserve is used in capital losses.
181. When premium amount is not received in forfeiture of share, share premium account is
debited.
182. Interest on calls in arrears is changed according to table A is 10% annum.
183. Company is an artificial person.
184. Each unit of small denomination of companies capital is called share.
185. A Stock is aggregate of fully paid shares which have been legally consolidated.
186. Shares which enjoy preferential right as to the payment of dividend at a fixed rate
during the life of the company and as to return of capital on winding up of the company.
187. Share which do not enjoy preferential right as to payment of dividend and return of
capital is called equity shares.
188. Capital raise by the issue of shares ,share capital of a company limited by shares
consists of preference share capital and equity share capital.
189. Nominal or register capital that is the maximum amount of capital which a company is
authorised to raise by the Memorandum of the company is called authorised capital.
190. The part of authorised capital which is actually issued to the public for subscription is
called issued capital.
191. The part of called a capital which is actually paid by subscribers is called paid up
capital.
192. Price of a share which is equal to its nominal price is called at par price.
193. Price of a share which is more than its nominal price is cause at premium price
194. Price of a share which is less than its nominal price is called at discount price
195. Number of shares applied by the public is more than the number of shares offered by
the company is called over subscription
196.That part of capital which has been called for payment is called called up capital.
197. Number of shares applied by the public is less than the number of shares offered by the
company is called under subscription.
198. That part of subscribe capital which a company resolves to call in the case of its
winding up is called Reserve capital.
199. Reserve created out of capital profits called Capital Reserve.
200. Cancellation of allotted shares is called forfeiture of shares.
201. Sale of forfeited shares is called re issue of shares.
202. Preference get first dividend of a company
203. When amount to be paid in calls is paid before is called advance.
204 . Minimum subscription is mentioned in prospectus.
205. As per Company Law board ,a company is regarded as on artificial person.
206. Shares have face value while stocks have no face value.
207. When a shareholder volunteerly surrender his share to the company it is known as
surrender of shares.
Teacher's Name
Sadhana Bachani

Chapter 7 Forfeiture and Re-Issue of shares

208. Share forfeiture account is shown in liability site of balance sheet.
209. when forfeited shares are issued at discount the share forfeiture account is debited.
210. When the articles contain no provision related to forfeiture of shares the company forfeit
shares by passing a special resolution.
211. To the absence of provisions for for feiture of share in articles of association a company
may forfeit share by passing a special resolution.
212. When a shareholder find its difficult to pay the amount due on calls shares held by him
as such he may surrender the shares of his possession.
213. Equity share holder have voting type
214. excess application received on over subscription
215 . Less applications received on under subscription
216. Preference shareholders have preference on dividend.
217. Calls in arrears is unpaid calls accounts .
218. Company Converted into shares at the time of dissolution.
219. Reserve capital is winding up of company.
220. Rate of dividend is fixed in preference shares.
221. There are more chances of speculation in equity shares.
222. According to table A company cannot call more than 25% of the nominal value of
shares at a time.
223. Premium is a type of capital gain
224. The discount allowed on the Re issue of forfeited share should never accept the
amount actually forfeited on such shares.
225. A private company does not issue the prospectus.
226. Government companies are the companies of at least 51% of its paid of capital is own
by the central or state governments or both.
227. Holding companies are the companies which has acquired more than half number of
other company's share.
228. On equity shares rate of dividend is not fixed.
229. Board of directors proposes for the forfeiture of shares.
230. A company is established by the person called promoter.
231. Share are always registered.
232. it is not necessary that a stock is registered.
233. A private company doesn't issue the prospectus.
234. The lump -sum amount can received on shares.
235. The amount which is due on shareholders and which is called up by the company but
shareholders could not paid till the fixed date then such amount is called calls in arrear.

Teacher's Name
Sadhana Bachani

Chapter 8 Issue of Debenture

236. Debenture is a certificate for loan taken.

237. Debentures can be issued at par or premium or discount.
238. There are two types of debentures according to tenure.
239. The amount of discount on issue of debenture is capital loss.
240. The limit of loan to be taken by a company is determined by its Memorandum of a
association and articles of association.
242. A private company can raise loan after acquiring certificate of Incorporation.
243. a public company as authorised to raise loan after acquiring certificate of
commencement of business
244. Convertible debentures cannot be issued at discount if they are to be converted
immediately.
245.Discount on issue of debentures will be shown in balance sheet under the heading other
non current assets.
246. Excess of assets over abilities at the time of purchasing a business is transferred to
Capital Reserve.
247. Own debentures means those debentures which the company purchase in open
market as investment.
248. Profit on cancellation of own debentures is transferred to Capital fund .
249. When debentures are redeemped out of profit then an equal amount is transferred to
debenture redemption reserve.
250. In debenture redemption reserve profit on the sale of investment is credited to profit and
loss statement.
251. interest allowed on debenture is fixed
252.. Balance of debenture Redemption reserve account is transferred after the redemption
of all the debentures general reserve.
253. Debenture holders come under the category of creditors.
254. Debentures which may be transferred by more delivery is called bearer.
255. The unpaid calls of debentures is called as call in arrears.
256. The fixed liability of a company is to pay to debenture on interest.
257. Income from debenture is fixed.
258. For the company ,discount on issue of debenture is a fictitious asset.
259. There are four kinds of debentures.
260. Period of payment of interest on debenture is 6 months
261. The amount of discount on issue of debenture is capital loss.
262. Payment to debentures is done in the lifetime of company.
263. The debentures which are redeemed for before paying any other type of debentures
are called first debentures.
264. Debenture holders does not interfere in management of company.
265. Generally interest on debenture is paid after expiry of a period of 6 months.
266 . Creditors are companies first debentures.
267. Debentures which can be changed into shares are called convertible debentures .
268. Debentures is a written acknowledgement of debt.
269. Entry in companies register is registered debentures .
270. Charge on Assets of a company is secured debentures.
271. Conversion of debentures is called convertible debentures.
272. Repayable after the fix period of time is redeem debentures.
273. At the time of companies resolution payment of debentures are preferred.
274. The return or consideration of the debenture is called interest.
275. Documents issued arr long term loan are called debenture.
276. Debentures are also issued from other consideration apart from cash.
277. companies debenture is generally Transferable.
278. Debenture can be redeemed on premium.

Teacher's Name
Sadhana Bachani

Chapter 9 Financial statement of a

company

279. The balance sheet shall be prepared only in vertical form.

280. According to Companies Act 2013 a company shall prepare and maintain the financial
statement according to schedule lll.
281. The statement of profit and loss shall be prepared in the form prescribed by part ll
Scheduled lll.
282. Financial statements include balance sheet ,statement of profit and loss ,notes to
accounts and cash flow systems.
283. Balance sheet position statement has two parts equity and liabilities , assets.
284. Assets part contains two heads - non current assets, current assets.
285. Balance sheet is called position statement .
286. Annual accounts of a company are presented before the annual general meeting of the
company by board of directors.
287. Balance sheets are divided into two parts.
288. Two parts of balance sheet is vertical and horizontal.
289. balance sheet is prepared on particular date.
290. Assets are equal to equity at liabilities.
291. Balance sheet under the Companies Act 2013 is prepared in vertical form.
292. Goodwill is fixed and intangible asset.
293. The items of balance sheet according to the company act 2013 is divided into two parts.
294 . The main head in which share capital is written is called shareholder funds.
295. Issued capital can never be more than authorised capital.
296. Companies balance check is prepared according to part I of schedule III of the
company act 2013.
297. Current liabilities are settled within 12 months.
298. No dividend is paid on share warrants.
299. On financial performance statement of profit and loss disclose.
300. Balance sheet is not an account.
301. Balance sheet is position sort of statement.
302. Profit and loss is an income statement.
303. To equity and liabilities assets are always equal.
304. Previous years figures are required to be given in a company's balance sheet.

Teacher's Name
Sadhana Bachani

Chapter 10 Financial statement of analysis

ratio
305. Ratio analysis analysis in which one figure is compared with an another figure and
which shows the relationship between the two.
306 Accounting ratio ignore the qualitative factors.
307. Expression of relationship between two mutual figure is called ratio.
308. Current ratio disclose the short term financial position.
309. The bank overdraft is related as current liabilities.
310. Cost of good sold is =l Net sales- Gross profit.
311 operating ratio is probability ratio.
312. Ratio Analysis established relation between two financial statements.

Teacher's Name
 Sadhana Bachani

Chapter 11 Cash flow Statement

313. Cash flow statement is included in the financial statement of commercial organisation.
314. Comparative statement is a form of horizontal analysis.
315. Goodwill abhi in balance sheet in the head non current assets.
316. Bill receivable is the Asset which will not be shown under the head" fixed assets in the
balance sheet of a company".
317. statement of profit and loss is called income statement.
318. The financial analysis provide assistance to derive the accurate decision to the
analyser.
319. Discount on issue of shares and debentures are shown is a set side of balance sheet.
320. The balance sheet of a company is prepared as per schedule VI part I of Companies
Act 1956. .
321. General analysis means simplification of data.
322. Trial balance is not a tool of analysis of financial statement.
323. The arrangement of employees provident fund is called as provision.
324. Under horizontal financial analysis data of two or more than two years are written
together for comparative study.
325. Even point defects no profit no loss.
326 Analysis of reason for changes in cash is cash flow statement.
327. The main objective of financial statement analysis is to know about profitability.
328. The overall objective of a business is to earn a satisfactory return on the points
invested.
329.fund flow statement means statement of changes in working capital.
330. Ratio analysis is most powerful tool of analysis of financial statements.
331. Break even point refers to that point where the total cost are just equal to the total
sales.
332. The analysis depicting the change in working capital during the year is called fund flow.
333. Only such information are included in financial statement which can be expressed in
terms of money.
334. The analysis which is used to judge the trend of operations of an enterprise and
computer in relationship is called trend analysis.
335. The ideal current ratio is 2:1.
336. Ratio analysis is closing natural relationship by comparative study of mathematical
expressions.
337. Find flow analysis to represent the changes in working capital.
338. Throwing light on sources and use of cash is cash flow analysis.
339. Liquidity ratio refers to establishing relationship between current assets and current
liabilities.
340. The trend various items can be Expressed in terms of percentage to trend analysis.
341. The other name of vertical analysis is common size analysis
342. The ratio is disclose a relationship between current assets and current liabilities is
called liquidity ratio.
343. The point at which total cost is equal to total revenue is called break even.
344. Every company prepared cash flow statement
345. Cash flow statement depics stock of cash and uses of cash.
346. Inflow of cash means cash received
347. Re payment of long term debt is financial activity.
348. Cash flow statement provides information about historical changes in cash and cash
equivalents.
349. Cash flow is classified into operating activities, investing activities and financing
activities.
350 Taxes on capital gains on fix assets should be classified under investing activities.
351. Payment of income tax relates to operating activity
352. Cash advances are lones made to third party should be included in cash outflows.
353. Cash flow statement is prepared in three steps.
354. At end of the year prepaid expenses are deducted from the earned profit for the year.
355. Creditors are the liabilities of a company.
356. Redemption of preference share is known as financial activities.
357. In commercial organisation the operating activities are its main /chief activities.
358. study of changes in working capital is fund flow statement.
359. Calculation of cash from operating activities is excluded non operating items.
360. Purchase of fixed asses is investing activities.
361. Profit earned during the accounting year is called net profit.
362. Cash receive from operating activities is the result of cash generated through business
activities.
363. In single column cash flow statement in flow of cash is added.

364.Current Ratio = Current Assets/ Current Liabilities

359.Quick Ratio = Quick assets/ Current Liabilities
365. Operating Margin = Gross Profit – Operating Expense/ Revenue
366. Profit margin = Revenue – Operating Expenses + Non-Operating Income – Interest
Expense – Income Taxes/ Revenue
367.Earnings per Share = Net Income – Preferred Dividend/ Weighted Average Outstanding
Shares
368. Debt Ratio = Total Liabilities/ Total Asset
369.Receivable Ratio = Annual Sales Credit/ Accounts Receivable
365. Asset Turnover Ratio = Net Revenue/ Assets
370. The main purpose of calculating operating profit ratio is to as certain operating profit.
371. Working capital is equal to current assets minus current liabilities.
372. capital turnover ratio shows relationship between capital employed and cost of goods
sold.
373. High stop turnover ratio indicates efficient management of stock.
374. Quick ratio is calculated to access the liquidity of a bussiness firm in its real sense
375. Current ratio as also called working capital ratio.
376. Acid test ratio is also called quick ratio..
377. Financial analysis is understood by the analysis and interpretation of financial
statements.
378. Sound financial position is key to success of business undertaking.
379. Mathematical expression is signified by accounting ratio
380. liquidity ratio is called short term solvency ratio.
381. Quick ratio is the relationship between quick Assets and current liabilities.
382 Cash flow statement is related to
AS-3.
383 Cash flow statement is required for
the financial planning of short term.
384 Non cash transaction reduced the
profit but does not reduce the cash.
385. Cash received from the issue of
share is financial activity.

Teacher's Name
Sadhana Bachani