Question : Which of the following statements is correct?
Option 1: Past financial statement analysis helps in assessing developments in future, especially in the next year.
Option 2: Financial analysis helps the users of the financial statements to understand the complicated matter in a simplified manner.
Option 3: On the basis of financial analysis we can take a variety of decisions in various areas such as securities analysis, credit analysis, debt analysis, dividend decision and general business analysis.
Option 4: All of the above
Correct Answer: All of the above
Solution : Answer = All of the above
1. Past financial statement analysis helps in assessing developments in future, especially in the next year. 2. Financial analysis helps the users of the financial statements to understand the complicated matter in a simplified manner. 3. On the basis of financial analysis we can make a variety of decisions in various areas such as securities analysis, credit analysis, debt analysis, dividend decision and general business analysis. Hence, the correct option is 4.
Question : Which of the following statements is incorrect?
Option 1: Inter-firm comparison becomes easy with the help of financial analysis
Option 2: Past financial statement analysis helps in assessing developments in future, especially in the next year
Option 3: Both 1 and 2
Option 4: None of the above
Question : Which of the following statement is correct with respect of Analysis of Financial Statements?
Option 1: Analysis of Financial Statements is a systematic process of analyzing the financial Information in the financial statements to understand and take economic decisions.
Option 2: Analysis of Financial Statements is a study of relationships among various financial values as set out in the financial statements, i.e., Balance Sheet, Statement of Profit and Loss and Cash Flow Statement.
Option 3: Financial Statement Analysis is largely a study of relationships among the various financial factors in a business,
Question : ---------------- is a process by which the investor comes to know whether the firm is fulfilling his expectations with regard to payment of dividend, capital appreciation and security of money.
Option 1: Securities Analysis
Option 2: Credit Analysis
Option 3: Debt Analysis
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