MCQs of Comparative and Common Size Statements Accountancy with answers
MCQs of Comparative and Common Size Statements Accountancy with answers for class 12 CBSE, ISC, CUET and State Boards
Which technique of financial analysis shows a comparative study of items or components of financial statements for two or more years?
(a) Common-Size Statement
(b) Ratio Analysis
(c) Comparative Statement
(d) Trend Analysis
Ans – (c)
Main objective of Common Size Statement is:
(a) To present the changes in various items
(b) To provide for a common base for comparison
(c) To establish relationship between various items
(d) All of the above
Ans – (d)
Main objective of Common Size Balance Sheet is:
(a) To establish relationship between revenue from operations and other items of statement of profit & loss
(b) To present changes in assets and liabilities
(c) To present changes in various items of income and expenses
(d) All of the above
Ans – (b)
The most commonly used tools for financial analysis are:
(a) Comparative Statements
(b) Common Size Statements
(c) Accounting Ratios
(D) All of the above
Ans – (d)
Main objective of Common Size Statement is:
(a) To present the changes in various items
(b) To provide for a common base for comparison
(c) To establish relationship between various items
(d) All of the above
Ans – (d)
Main objective of Common Size Balance Sheet is:
(a) To establish relationship between revenue from operations and other items of statement of profit & loss
(b) To present changes in assets and liabilities
(c) To present changes in various items of income and expenses
(d) All of the above
Ans – (b)
Which of the following is not a tool for Analysis of Financial Statements:
(a) Cash Flow Statement
(b) Trend Analysis
(c) Ratio Analysis
(d) Balance Sheet
Ans – (d)
Common Size Statements are prepared
(a) In the form of Ratios
(b) In the form of Percentages
(c) In both of the above
(d) None of the above
Ans – (b)
Which of the following is untrue:
(a) Common Size Balance Sheet
(b) Common Size Statement of Profit & Loss
(c) Common Size Cash Flow Statement
(d) None of the Above
Ans – (c)
Which of the following is tool of financial analysis?
(a) Comparative Statements
(b) Common-Size Statements
(c) Cash Flow Statement
(d) All of these
Ans – (d)
Main objective of Common Size Statement of Profit & Loss is:
(a) To present changes in assets and liabilities
(b) To judge the financial soundness
(c) To establish relationship between revenue from operations and other items of statement of Profit & Loss
(d) All of the above
Ans – (c)
In the Statement of Profit & Loss of a Common Size Statement:
(a) Figure of net revenue from operations is assumed to be qual to 100
(b) Figure of gross profit is assumed to be equal to 100
(c) Figure of net profit is assumed to be qual to 100
(d) Figure of assets is assumed to be qual to 100
Ans – (a)
Which one of the following items is not a tool used for financial analysis?
(a) Comparative Statements
(b) Ratio Analysis
(c) Common Size Statements
(d) Statement of Dividend Distribution
Ans – (d)
Which of the following items is not a method/tool of analysis of financial statements?
(a) Trend Analysis
(b) Statement of Affairs
(c) Cash Flow Statement
(d) Comparative Statements
Ans – (b)
In the Balance Sheet of a Common Size Statement:
(a) Figure of share capital is assumed to be 100
(b) Figure of current liabilities is assumed to be 100
(c) Figure of non-Current assets is assumed to be 100
(d) Figure of total assets is assumed to be 100
Ans – (d)
Total assets of a firm are ₹ 20,00,000 and its non-current assets are ₹ 8,00,000. What will be the percentage of non-Current assets on total assets?
(a) 60%
(b) 40%
(c) 29%
(d) 71%
Ans – (b)
Fixed Assets of a company increased from ₹ 8,00,000 to ₹ 10,00,000. The percentage change is
(a) 20%
(b) 33.3%
(c) 25%
(d) 40%
Ans – (c)
If total assets of a firm are ₹ 8,20,000 and it snon-current assets are ₹ 5,90,400. What will be the percentage of current assets on total assets?
(a) 42%
(b) 58%
(c) 28%
(d) 72%
Ans – (c)
If net revenue from operations of a firm are ₹ 1,20,000; cost of revenue from operations is ₹ 66,000 and operating expenses are ₹ 21,600, What will be the percentage of operating income on net revenue from operations?
(a) 55%
(b) 45%
(c) 73%
(d) 27%
Ans – (d)
Revenue from Operations is ₹ 50,00,000, other income is 20% of Revenue from Operations and Expenses are 50% of Revenue from Operations. Amount of profit before tax will be
(a) ₹ 35,00,000
(b) ₹ 30,00,000
(c) ₹ 25,00,000
(d) ₹ 45,00,000
Ans – (a)
Which one of the following items is not a method/tool of analysis of financial statements?
(a) Accounting Ratio
(b) Break Even Point
(c) Statement of Receipts and Payments
(d) Fund Flow Statement
Ans – (c)
If net revenue from operations of a firm are ₹ 15,00,000; Gross Profit is ₹ 9,00,000 and operating expenses are ₹ 75,000, what will be percentage of operating income on net revenue from operations?
(a) 45%
(b) 55%
(c) 35%
(d) 65%
Ans – (b)
Main objective of Trend Analysis is
(a) To make comparative study of the financial statements for a number of years
(b) To indicate the direction of movement
(c) To help in forecasts of various items
(d) All of the above
Ans – (d)
Which one of the following items is not a method/tool of analysis of financial statements?
(a) Fund Flow Statement
(b) Common Size Statement
(c) Statement of Trade Receivables
(d) Cash Flow Statement
Ans – (c)
What will be the trend percentage, if the Inventory of a firm is ₹ 2,00,000; ₹ 2,40,000; ₹ 3,00,000 and ₹ 4,00,000 respectively?
(a) 1, 1.2, 1.5, 2
(b0 10, 12, 15, 20
(c) 100, 120, 150, 200
(d) None of the Above
Ans – (c)
In a common size Balance Sheet, total liabilities are assumed to be qual to:
(a) 1
(b) 10
(c) 100
(d) 1,000
Ans – (c)
Revenue from Operations is ₹ 60,00,000; other income is 15% of Revenue from Operations. Expenses are 60% of Revenue from Operations and tax rate is 40%. Amount of profit after tax will be
(a) ₹ 14,40,000
(b) ₹ 19,80,000
(c) ₹ 13,80,000
(d) ₹ 16,56,000
Ans – (b)
Which of the following is the objective of comparative Statements?
(a) To make the data simpler and understandable
(b) To indicate the trend
(c) To help in forecasting
(d) All of the above
Ans – (d)
Which of the following is device of comparative statements?
(a) Comparison expressed in terms of absolute data
(b) Comparison expressed in terms of percentages
(c) Comparison expressed in terms of ratios
(d) All of the above
Ans – (d)
In a common size Statement of Profit & Loss, the amount of net revenue from operations is assumed to be equal to
(a) 1
(b) 10
(c) 100
(d) 1,000
Ans – (c)
The objective of common size Statement of Profit & Loss is not to
(a) Present Changes in Various items of incomes and expenses
(b) Judge the cost items
(c) Establish relationship between revenue from operations and other items of statement of profit & loss
(d) Judge the relative financial soundness for different enterprises
Ans – (d)
‘No profit no loss’ point is called:
(a) Fund Flow Point
(b) Cash Flow Point
(c) Trend Analysis
(d) Break Even Point
Ans – (d)
Net profit is obtained by deducting __ from Gross Profit.
(a) Operating Expenses
(b) Non-Operating Exp.
(c) Operating and Non-Operating Exp.
(d) None of the above
Ans – (c)
Total Assets of Star Ltd. are ₹ 10,00,000; Shareholders’ Funds: ₹ 6,00,000. The percentage of Shareholders’ Funds in Common-Size Balance Sheet will be
(a) 40%
(b) 50%
(c) 70%
(d) 60%
Ans – (d)
Comparative Balance Sheet:
(a) Provides a summarized view of the operations of the firm
(b) Presents the financial position of the firm
(c) Presents the change in various items of balance sheet
(d) None of the above
Ans – (c)
Comparative Statement of Profit & Loss provides information about:
(a) Rate of increase or decrease in revenue from Operations
(b) Rate of increase or decrease in cost of revenue from Operations
(c) Rate of increase or decrease in net profit
(d) All of the above
Ans – (d)
Amount left after deducting gross profit from Revenue from Operations is generally:
(a) Cost of Revenue from Operations
(b) Material Consumed
(c) Opening Inventory + Purchases – Closing Inventory
(d) All of the above
Ans – (a)
What is gross Profit + Materials consumed?
(a) Purchases
(b) Revenue from Operations
(c) Opening Inventory
(d) Closing Inventory
Ans – (b)
Comparison of actual values of one firm with those of another firm belonging to the same industry is
(a) Inter-firm Comparison
(b) Intra-firm Comparison
(c) Pattern Comparison
(d) Standard Comparison
Ans – (a)
Which analysis is considered more dynamic?
(a) Horizontal Analysis
(c) Vertical Analysis
(c) Internal Analysis
(d) External Analysis
Ans – (a)
While preparing Common-size Income statement, each item of Income Statement is expressed as % of
(a) Revenue from Operations
(b) Other Income
(c) Total Income
(d) Profit before Tax
Ans – (a)
Which analysis depicts the relationship between two figures:
(a) Ratio Analysis
(b) Trend Analysis
(c) Cumulative figures and averages
(d) Dividend Analysis
Ans – (a)
In which analysis total cost are equal to total revenue from Operations:
(a) Trend Analysis
(b) Ratio Analysis
(c) Break-Even Point Analysis
(d) Cash Flow Statement Analysis
Ans – (c)
While preparing Common-Size Balance Sheet, each item of Balance Sheet is expressed as % of
(a) Current Assets
(b) Non-Current Assets
(c) Non-Current Liabilities
(d) Total Assets
Ans – (d)
Non-Current Assets of a company increase from ₹ 3,00,000 to ₹ 4,00,000. What is the percentage of change?
(a) 25%
(b) 33.3%
(c) 20%
(d) 40%
Ans – (b)
A Company’s current liabilities decreased from ₹ 4,00,000 to ₹ 3,00,000. What is the percentage of change?
(a) (25%)
(b) 33.3%
(c) 20%
(d) 25%
Ans – (a)
Under which tool of financial analysis, 100% is taken as base and all other related amounts are expressed as a percentage of base?
(a) Comparative Statement
(b) Common-Size Statement
(c) Ratio Analysis
(d) Cash Flow Statement
Ans – (b)
A company’s working capital is ₹ 10 lakh (Negative balance) in the year 2018. It became ₹ 15 lakh (Positive balance) in the year 2019. What is the percentage of change?
(a) 150%
(b) 100%
(d) 250%
(d) 50%
Ans – (c)
A company’s Revenue from Operations are ₹ 20,00,000; Cost of Revenue from Operations is ₹ 14,00,000 and indirect expenses are ₹ 2,00,000. What is the amount of Gross Profit?
(a) ₹ 18,00,000
(b) ₹ 4,00,000
(c) ₹ 8,00,000
(d) ₹ 6,00,000
Ans – (d)
Reserves and Surplus of Jai Ltd. were ₹ 10,00,000 (Negative Balance) in the year 2023-24. It becomes ₹ 15,00,000 in the year 202425. The percentage change in Reserves and Surplus is
(a) 50%
(b) 100%
(c) 150%
(c) 250%
Ans – (d)
Revenue from Operations ₹ 4,00,000; Cost of Revenue from Operations 60% of Revenue from Operations; Operating expenses ₹ 30,000 and rate of income tax is 40$. What will be amount of profit after tax?
(a) ₹ 64,000
(b) ₹78,0000
(c) ₹ 52,000
(d) ₹ 96,000
Ans – (b)
Revenue from Operations ₹ 8,00,000; Gross Profit RAtio 32%; Indirect Exp. 10% of Gross Profit and Income tax 40%. What will be the amount of profit after tax?
(a) ₹ 1,38,240
(b) ₹ 1,02,400
(c) ₹ 81,600
(d) ₹ 96,000
Ans – (c)
Comparative Statements are also known as
(a) Horizontal Analysis
(b) Dynamic Analysis
(c) External Analysis
(d) Vertical Analysis
Ans – (a)
Payment of Income Tax is considered as
(a) Direct Expenses
(b) Indirect Expenses
(c) Operating Expenses
(d) None of the above
Ans – (b)
Interest on Loans is
(a) Direct Expenses
(b) Indirect Expenses
(c) Operating Expenses
(d) None of the above
Ans – (b)
The statement in which individual items of financial statements of two or more years are placed side by side and converted into percentage of a common base is
(a) Comparative Statements
(b) Common-Size Statements
(c) Financial Statements
(d) None of these
Ans – (b)
Revenue from Operations less cost of Revenue from Operations is called:
(a) Net Profit
(b) Operating Profit
(c) Gross Profit
(d) Total Profit
Ans – (c)
Which objective is not fulfilled by Comparative Statement of Profit & Loss:
(a) To compare the items of Statement of Profit & Loss of two years
(b) To know the absolute changes in items of Statements of Profit & Loss
(c) To show the change in financial position
(d) To know the percentage changes in items of Statements of Profit & Loss
Ans – (c)
Comparative Income Statement shows
(a) Revenue and Expenses in absolute value
(b) Increase/decrease in absolute value of Revenue and Expenses
(c) Proportionate Changes in Revenues and Expenses
(d) All of the above
Ans – (d)
In comparative statements change in different items is presented in the form of __.
(a) Money values
(b) Percentages
(c) Both Money Values and Percentages
(d) None of the above
Ans – (c)
Which of the following is not a form of presenting financial analysis:
(a) Absolute figure Comparison
(b) Ratio Method
(c) Cumulative figures and averages
(d) Annual Report
Ans – (d)
Which objective is not fulfilled by comparative financial statement:
(a) Indicate the extent of change in assets and liabilities
(b) Indicate the extent of change in items of Statement of Profit & Loss
(c) Show effect of operative activities on assets and liabilities
(d) Show the direction of change in assets and liabilities
Ans – (c)
