Sponsor Area
Analysis Of Financial Statements
State the objectives of 'Analysis of Financial Statements'.
The following are the various objectives for preparing financial statements.
It enables the conduct of meaningful comparisons of financial data. It provides better and easy understanding of the changes in the financial data overtime. It helps in designing effective plans and better execution of plans by enabling control and checks over the use of the financial resources.
Analysis of Financial Statements helps to know the earning capacity and profitability of a business firm. It also measures the efficiency of the business operations.
Some More Questions From Analysis of Financial Statements Chapter
From the following Balance Sheets of Sonam Ltd as on 31-3-2012 and 31-3-2011.
Prepare a Cash Flow Statements:
Liabilities
31-3-2011
Rs
31-3-2011
Rs
Assets
31-3-2011
Rs
31-3-2011
Rs
Equity Shares Capital
Profit and Loss Account
Bank Loan
Proposed Dividend
Provision for tax
Creditors
1,00,000
25,000
50,000
20,000
10,000
15,000
1,50,000
50,000
25,000
15,000
17,500
11,250
Patents
Building
Investment
Debtors
Stock
Cash
12,500
1,50,000
-
50,000
2,500
5,000
11,250
1,50,000
18,750
63,750
3,750
21,250
2,20,000
2,68,750
2,20,000
2,68,750
Additional Information:
During the year a Building having book value Rs 50,000 was sold at a loss of Rs 2,000 and depreciation charged on Building was Rs 4,000.
Prepare a Cash Flow Statements:
Liabilities
31-3-2011
Rs
31-3-2011
Rs
Assets
31-3-2011
Rs
31-3-2011
Rs
Equity Shares Capital
Profit and Loss Account
Bank Loan
Proposed Dividend
Provision for tax
Creditors
1,00,000
25,000
50,000
20,000
10,000
15,000
1,50,000
50,000
25,000
15,000
17,500
11,250
Patents
Building
Investment
Debtors
Stock
Cash
12,500
1,50,000
-
50,000
2,500
5,000
11,250
1,50,000
18,750
63,750
3,750
21,250
2,20,000
2,68,750
2,20,000
2,68,750
During the year a Building having book value Rs 50,000 was sold at a loss of Rs 2,000 and depreciation charged on Building was Rs 4,000.
What is meant by a 'Common Size Statement’?
Prepare a Comparative Income Statement from the following information.
2009 2010
Rs. Rs.
Sales 10,00,000 12,50,000
Cost of goods sold 5,00,000 6,50,000
Carriage inwards 30,000 50,000
Operating Expenses 50,000 60,0000
Income Tax 50% 50%
Cost of goods sold 5,00,000 6,50,000
Carriage inwards 30,000 50,000
Operating Expenses 50,000 60,0000
Income Tax 50% 50%
State the objectives of 'Analysis of Financial Statements'.
Sponsor Area
Mock Test Series
Mock Test Series