Class 12 Accountancy - Company Accounts and Analysis of Financial Statements - Chapter Analysis of Financial Statement NCERT Solutions | State the importance of Financial Analys
State the importance of Financial Analysis?
Financial Analysis has great importance to various accounting users on
various matters:
1. It helps in evaluating the profit earning capacity and financial feasibility of a business.
2. It helps in assessing the long-term solvency of the business.
53. Many business owners and company managers have found that insight gained from their examination of company financial statements can be invaluable. Such insight can help businesses improve their profitability, cash flow, and value.
More Questions From Class 12 Accountancy - Company Accounts and Analysis of Financial Statements - Chapter Analysis of Financial Statement
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Explain the usefulness of trend percentages in interpretation of financial performance of a company.
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What do you understand by analysis and interpretation of financial statements? Discuss its importance.
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Describe the different techniques of financial analysis and explain the limitations of financial analysis.
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What is the importance of comparative statements? Illustrate youranswer with particular reference to comparative income statement.
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Explain how common size statements are prepared giving an example.
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What do you mean by Common Size Statements?
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List the techniques of Financial Statement Analysis.
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What are Comparative Financial Statements?
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State the meaning of Analysis and Interpretation.
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Distinguish between Vertical and Horizontal Analysis of financial data.
Popular Questions of Class 12 Accountancy - Company Accounts and Analysis of Financial Statements
- Q:- What is meant by a Debenture?
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What do you mean by Ratio Analysis?
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State the meaning of financial statement analysis?
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What does a Bearer Debenture mean?
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What are various types of ratios?
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What are limitations of financial statement analysis?
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State the meaning of ‘Debentures issued as a collateral security’.
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What relationships will be established to study?
(a) Inventory Turnover (b) Debtor Turnover
(c) Payables Turnover (d) Working Capital Turnover - Q:-
List any three objectives of analysing financial statements?
- Q:-
What is meant by ‘Issue of debentures for consideration other than cash’?
Recently Viewed Questions of Class 12 Accountancy - Company Accounts and Analysis of Financial Statements
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‘Financial statements reflect a combination of recorded facts, accounting
conventions and personal judgements’ discuss. - Q:-
What is a ‘Convertible Debenture’?
- Q:-
How would you study the Solvency position of the firm?
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Explain the different terms for the issue of debentures with reference to their redemption.
- Q:-
State the importance of financial statements to
(i) shareholders
(ii) creditors
(iii) government
(iv) investors - Q:-
What is meant by ‘Premium on Redemption of Debentures’?
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What is meant by a ‘Irredeemable Debenture’?
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What are liquidity ratios? Discuss the importance of current and liquid ratio.
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What is meant by ‘Redemption out of Capital?
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What is meant by conversion of debentures? Describe the method of such a conversion.
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