Q. The ________ does not represent continuing operations in any way, but is simply a snapshot of the total worth of a firm at a given point in time.
✅ Correct Answer: (B)
balance sheet
Analysis of Financial Statements MCQs and Notes
Q. The major device for measuring the profitability of a firm over a defined period of time is the
✅ Correct Answer: (A)
income statement.
Q. Interpretation of accounts is the
✅ Correct Answer: (D)
all of the above
Q. Which of the following are techniques, tools or methods of analysis and interpretation of financial statements?
✅ Correct Answer: (D)
all of the above
Q. Analysis of any financial Statement comprises
✅ Correct Answer: (D)
all of the above
Q. Incorrect cash flow planning can lead to ________
✅ Correct Answer: (C)
bankruptcy
Q. If value of opening inventories increases, what happens to the value of gross profit?
✅ Correct Answer: (A)
decreases
Q. ________is a simply the amount of cash coming in to a business.
✅ Correct Answer: (A)
cash flow
Q. Which of the following is technique of financial statement analysis?
✅ Correct Answer: (D)
all
Q. The process of comparing various financial factors of a company over a period of time is known as …
✅ Correct Answer: (C)
intra‐firm comparison