Question : Long-term and short-term solvency of an enterprise can be assessed on the basis of ___________.
Option 1: Financial statement analysis
Option 2: Inter-firm Comparison
Option 3: cross-sectional analysis
Option 4: None of the above
Correct Answer: Financial statement analysis
Solution : Answer = Financial statement analysis
The process of identifying an organization's financial strengths and weaknesses via the appropriate charting of the links between various balance sheet elements and the profit and loss statement is known as financial analysis. Hence, the correct option is 1.
Question : The objective of financial statement analysis is _______ comparison.
Option 1: Inter firm
Option 2: Intra firm
Option 3: Both 1 and 2
Question : Which of the following best describes the intent or goal of financial analysis?
Option 1: To assess the short-term and long-term liquidity position of the firm
Option 2: To assess the current profitability of the firm
Option 3: To measure the solvency of the firm
Option 4: All the above
Question : The liquidity ratio is also called________?
Option 1: Long-term solvency Ratio
Option 2: Medium-term solvency Ratio
Option 3: Short-term solvency Ratio
Option 4: All of the above
Question : ------------------involves the comparison of a firm’s ratios with that of some selected firms in the same industry or industry average at the same point of time. Such a comparison is helpful in assessing the relative financial position and performance of the firm.
Option 1: Time – series analysis
Option 2: Cross-sectional analysis
Option 3: Ratio
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