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Class 12 Accountancy
Accounting Ratios
Quiz 1
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Which one of the following ratios is most important in determining the long-term solvency of a company ?
0%
Profitability Ratio
0%
Debt-Equity Ratio
0%
Stock Turnover Ratio
0%
Current Ratio
Explanation
Debt-Equity Ratio
Total Assets ₹ 8,10,000
0%
0.05 : 1
0%
0.4 : 1
0%
2.5 : 1
0%
4 : 1
Explanation
2.5 : 1
Equity share capital ₹ 15,00,000
0%
50%
0%
33.3%
0%
200%
0%
60%
Explanation
50%
Total Assets ₹ 7,70,000
0%
3.5 : 1
0%
2.56 : 1
0%
2.8 : 1
0%
3 : 1
Explanation
3.5 : 1
Profitability Ratios are generally expressed in :
0%
Simple Ratio
0%
Percentage
0%
Times
0%
None of these
Explanation
Percentage
The gross profit ratio is the ratio of gross profit to :
0%
Net Cash Sales
0%
Net Credit Sales
0%
Closing Stock
0%
Net Total Sales
Explanation
Net Total Sales
Operating Ratio is:
0%
Profitability Ratio
0%
Activity Ratio
0%
Solvency Ratio
0%
None of these
Explanation
Profitability Ratio
Which of the following is an operating’ income ?
0%
Sale of Merchandise
0%
Interest Income
0%
Dividend Income
0%
Profit on the sale of old car
Explanation
Sale of Merchandise
Which of the following non-operating expense?
0%
Rent
0%
Selling Expenses
0%
Wages
0%
Loss on Sale of Machinery
Explanation
Loss on Sale of Machinery
The following groups of ratios primarily measure risk
0%
Liquidity, activity and profitability
0%
Liquidity, activity and common stock
0%
Liquidity, activity and debt
0%
Activity, debt and profitability
Explanation
Activity, debt and profitability
To know the return on investment, by capital employed we mean:
0%
Net Fixed Assets
0%
Current Asset-Current Liabilities
0%
Gross Block
0%
Fixed Assets + Current Assets-Current Liabilities
Explanation
Fixed Assets + Current Assets-Current Liabilities
The term fixed assets include :
0%
Cash
0%
Machinery
0%
Debtors
0%
Prepaid Expenses
Explanation
Machinery
Ratio based on figures of profit & loss as well a the Balance sheet are:
0%
Profitability Ratios
0%
Operation Ratio
0%
Liquidity Ratio
0%
Composite Ratio
Explanation
Composite Ratio
When opening stock is ₹ 50,000 closing stock ₹ 60,000 and cost of goods sold is ₹ 2,20,000, then stock turn over ratio is:
0%
2 times
0%
3 times
0%
4 times
0%
5 times
Explanation
2 times
What does Creditors Turnover Ratio take into account:
0%
Total credit purchases
0%
Total credit sales
0%
Total cash sales
0%
Total cash purchases
Explanation
Total credit purchases
Cost of goods sold :
0%
Sales – Net profit
0%
Sales – Gross profit
0%
Purchases – Opening Stock
0%
None of the above
Explanation
Sales – Gross profit
The ideal liquid ratio is :
0%
2 : 1
0%
1 : 1
0%
5 : 1
0%
4 : 1
Explanation
1 : 1
The ideal current ratio is :
0%
2 : 1
0%
1 : 2
0%
3 : 2
0%
3 : 4
Explanation
2 : 1
Profitability Ratio is generally shown in :
0%
Simple Ratio
0%
Percentage
0%
Times
0%
None of these
Explanation
Percentage
If sales is 7 4,20,000 sales returns is 7 20,000 and cost of goods sold 7 3,20,000 gross profit ratio will be :
0%
20%
0%
25%
0%
15%
0%
10%
Explanation
20%
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