Financial Analysis and Cash Flow Quiz
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Questions and Answers

When a partner retires from a firm with the consent of all other partners, what account is prepared?

  • Realisation Account
  • Partner Executor Account (correct)
  • Profit and Loss Account
  • Bank Account
  • What happens to the cash-in-hand of a firm on dissolution?

  • Transferred to Realisation Account (correct)
  • Transferred to Profit and Loss Account
  • Deposited in a Bank Account
  • None of the above
  • In the event of compulsory dissolution of a firm, what happens to its bank overdraft?

  • Transferred to Realisation Account
  • Written off as a loss
  • Repayment from the assets realized (correct)
  • None of the above
  • Why do we calculate Gaining Ratio?

    <p>To determine the new profit-sharing ratio of partners</p> Signup and view all the answers

    In accounting, when a firm disposes of its fixed assets, the difference between the disposal proceeds and the carrying amount of the asset is known as:

    <p>Profit on Sale of Asset</p> Signup and view all the answers

    In financial analysis, what does the term 'interpretation' refer to?

    <p>Explaining the meaning of financial ratios</p> Signup and view all the answers

    When analyzing a firm's cash flow statement, if there is a bank overdraft, how is it typically classified?

    <p>Financing Activity</p> Signup and view all the answers

    When a company issues debentures, it is essentially:

    <p>Borrowing funds from investors</p> Signup and view all the answers

    Which of the following is NOT a tool of financial analysis?

    <p>Capital Budgeting Techniques</p> Signup and view all the answers

    When a fixed asset with a book value of ₹1,20,000 is sold at a loss of ₹40,000, what is the impact on cash flow?

    <p>Cash outflow of ₹40,000</p> Signup and view all the answers

    In the context of corporate finance, what happens when shares are forfeited by shareholders?

    <p>Retained earnings decrease</p> Signup and view all the answers

    When shares are forfeited due to non-payment and then reissued as fully paid, what accounting treatment is needed?

    <p>Crediting reissue account</p> Signup and view all the answers

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