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Sample Questions - Common Size Statements | Crash Course of Accountancy - Class 12 - Commerce PDF Download

                                                     Common Size Statements
Time – 50 mins

M.M. - 30

Q1. State the limitations of financial statement analysis? (2 marks)

Q2. Give the headings under which the following items will be shown in a company's Balance Sheet:
(a) Cash in hand                        (d) Debentures
(b) Land                                      (e) Capital Redemption Reserve
(c) Sundry Debtors                    (f) Loose Tools
(3 marks)

Q3. The following credit balances were extracted from the books of Rama Ltd. on 31st March, 2013:
Share Capital (40,000 shares of ~ 10 each fully paid) 4,00,000
Securities Premium ...........................................................................40,000
12% Debentures .................................................................................2,00,000
Fixed Deposits from Public ................................................................35,000
Sundry Creditors ................................................................................17,500
Provision for Taxation ........................................................................7,500
Draw up the 'liabilty' side of the Balance Sheet according to the requirements of the Companies Act, 2013. Also prepare Notes. (2 marks)

Q4. The following debit balances were extracted from the books of Shruti Ltd. as on 31st March, 2013:
Land & Building                            2,00,000                     Debtors                 1,50,000
Plant & Machinery                        8,00,000                     Cash at Bank        38,000
Goodwill                                         2,00,000                     Stock-in-Trade     90,000
Investments in Properties           2,00,000                      Loose Tools           5,000
Bills Receivable                             50,000                          Cash on Hand       17,000
Draw up the 'Assets' side of the Balance Sheet according to the requirements of the Companies Act, 2013. Also prepare notes. (3 marks)

Q5. Prepare a statement for showing the percentage changes in the  performance of Lakha ltd.

Particulars                                                             2012            2011
Revenue from operations                                   5,00,000     4,00,000
Cost of Revenue from operations                      half of the RFO
Selling expenses                                                   one tenth of cogs
Dividend received                                                20,000         10,000
Income tax                                                            50 %             40 %
(4 marks)

Q6. From the following information, prepare comparative statements:
                                                                           31, march 2013              31, march 2014
Revenue from operations                              12 lac                                16 lac
Purchase of stock in trade                             7.60lac                             9 lac
Change in inventory                                       40,000                             (50,000)
Employee benefit expenses                           20% of RFO                     18% of RFO
Tax rate                                                            50%                                   50%
(4 marks)

Q7. What is financial statement analysis and name the different tools of financial statement analysis? (2 marks)

Q8. Prepare Comparative and common size Balance Sheet from the following information:
Sample Questions - Common Size Statements | Crash Course of Accountancy - Class 12 - Commerce
(6 marks)

Q9. Mudra Ltd. is in the process of preparing its Balance Sheet as per Schedule III, Part I of the Companies Act, 2013 and provides its true and fair view of the financial position.
(a) Under which head and sub-head will the company show ‘Stores and Spares’ in its Balance Sheet?
(b) What is the accounting treatment of ‘Stores and Spares’ when the Company will calculate its Inventory Turnover Ratio?
(c) The management of Mudra Ltd. want to analyse its Financial Statements. State any two objectives of such analysis.
(d) Identify the value being followed by Mudra Ltd.
(4 marks)

The document Sample Questions - Common Size Statements | Crash Course of Accountancy - Class 12 - Commerce is a part of the Commerce Course Crash Course of Accountancy - Class 12.
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FAQs on Sample Questions - Common Size Statements - Crash Course of Accountancy - Class 12 - Commerce

1. What are common size statements in commerce?
Ans. Common size statements in commerce refer to financial statements where each line item is expressed as a percentage of a base figure, usually sales or total assets. This allows for easier comparison of different companies or different periods within the same company.
2. Why are common size statements important in financial analysis?
Ans. Common size statements are important in financial analysis because they help to identify trends and patterns in a company's financial performance. By expressing each line item as a percentage of a base figure, it becomes easier to compare and analyze the relative importance of different components of the financial statements.
3. How can common size statements be used to compare companies?
Ans. Common size statements can be used to compare companies by expressing each line item as a percentage of a base figure, such as sales. By doing so, it becomes easier to compare the relative size and importance of different components in the financial statements of different companies, facilitating a more meaningful comparison.
4. What are some limitations of common size statements?
Ans. Some limitations of common size statements include the fact that they only provide a snapshot of a company's financial performance at a particular point in time and may not capture the full context or dynamics of the business. Additionally, common size statements rely on accurate and consistent data, which may not always be available or comparable across companies.
5. How can common size statements help in identifying areas of improvement for a company?
Ans. Common size statements can help in identifying areas of improvement for a company by highlighting the relative importance of different line items in the financial statements. By analyzing the percentages and trends, management can identify areas that may require attention or improvement, such as high operating expenses or low profitability ratios.
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