Question : Which of the following are the objectives and significance of the current ratio?

Option 1: Current ratio is used to assess the firm’s ability to meet its short-term liabilities on time. 

Option 2: According to accounting principles, a current ratio of 2:1 is supposed to be an ideal ratio. It means that the current assets of a business should, at least, be twice its current liabilities.

Option 3: The higher the ratio, the better it is, because the firm will be able to pay its current liabilities more easily.

Option 4: All of the above.

Question : An accounting information system processes the financial transactions and events based on -

Option 1: Governing Principles

Option 2: Management Principles

Option 3: Accepted Principles

Option 4: Generally Accepted Accounting Principles

Question : Which of the following is correct for the objectives of Ratio Analysis:
A:To simplify the accounting information
B: To assess the operating efficiency of the business.
C:To help in comparative analysis
D:To analyze the profitability of the business.

Option 1: A, B and C 

Option 2: B, C, and D 

Option 3: A, C and D

Option 4: All of the above

Question : Which of the following statements is true?

Option 1: If the amount of interest accrued and due is not paid, it is known as Interest Accrued and Due or Interest Outstanding

Option 2: If the date of payment of interest and accounting date are different, Interest Accrued and Not Due Account is credited at the end of the year to maintain accounting records on accrual basis
 

Option 3: Interest Accrued or Outstanding (whether due or not) on Debentures is shown under the main head 'Current Liabilities' and sub-head 'Other Current Liabilities'

Option 4: All  of the above 

Question : Which of the following statements is true?

Option 1: If the amount of interest accrued and due is not paid, it is known as Interest Accrued and Due or Interest Outstanding

Option 2: If the date of payment of interest and accounting date are different, Interest Accrued and Not Due Account is credited at the end of the year to maintain accounting records on accrual basis
 

Option 3: Interest Accrued or Outstanding (whether due or not) on Debentures is shown under the main head 'Current Liabilities' and sub-head 'Other Current Liabilities'

Option 4: All  of the above