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Model Test Papers M.415

PART B

ANALYSIS OF FINANCIAL STATEMENTS
18. What is meant by Operating Activities? (1)

19. State with reason whether charging of Depreciation on machinery would result in
inflow, outflow or no flow of Cash or Cash Equivalents. (1)
20. (a) Name the sub-heads under the head ‘Non-Current Liabilities’ in the Equity and
Liabilities part of the Balance Sheet as per Schedule III of the Companies Act, 2013.
(b) State any two limitations of Financial Statements. (4)
21. (a) The Debt to Equity Ratio of Alpha Co. and Salpha Co. are 1 : 1 and 2 : 1 respectively.
Which company in your opinion, has got better debt-equity and why?
From the following information, compute ‘Debt to Equity Ratio’:
`
Long-term Borrowings 2,00,000
Long-term Provisions 1,00,000
Current Liabilities 50,000
Non-Current Assets 3,60,000
Current Assets 90,000
(b) Current Ratio of X Ltd. is 2 : 1. State with reason which of the following transactions
would (i) improve; (ii) decline; or (iii) not change the ratio:
(i) Payment of final declared dividend.
(ii) Company issued 1,00,000 equity shares of ` 10 each to the Vendors of machinery
purchased.
Or
(a) List any two ratios showing efficiency as to the utilisation of Assets.
(b) State the objective of computing Current Ratio.
(c) Revenue from Operations is ` 20,00,000, Gross Profit Ratio is 25%, Operating
Ratio is 90%. Non-operating Expenses are ` 10,000, Non-Operating Income is
` 1,10,000.
Calculate Net Profit Ratio. (2 + 2 or 1 + 1 + 2)
22. From the following information taken from Statement of Profit and Loss of Rose
Products Ltd. for the year ended 31st March, 2018 and 2017, prepare Comparative
Statement of Profit and Loss:

Particulars Note No. 31st March, 31st March,
2018 (`) 2017 (`)

Revenue from Operations 14,00,000 11,00,000
Other Incomes 4,00,000 3,00,000
Expenses 11,00,000 12,00,000
Rate of Income Tax was 50%.
Also, calculate Net Profit Ratio for 2017–18. (4)