Assignment No.

Programme Name : MBA Semester: I Credit: 3

Course Title : FINANCIAL REPORTING & Course Code: MBA604

ANALYSIS
Submitted Date: Last date of Submission:

Max. Marks: 30 Weight age: 15 Marks

Instructions:

 Sec-A is compulsory which consists of 10 Multiple Choice Questions (1 mark per question)
 Attempt any four questions from Sec-B out of Seven questions (5 marks each)

Section –A (10 Marks)

1. Which among the following is the objective of 6. Net working capital is defined as………..
‘Financial Statement’? (a) Total assets minus(b) Excess of current assets
(a)It helps in financial (b) Helps in safeguarding current assets over current liabilities
Forecasting interest of shareholders (c) Current liabilities(d) Marketable securities
(c) It helps in evaluating (d) All of the above less current assets and cash
earning capacity of the firm

6. The …….is a measure of liquidity which 7. Outsiders in an organization doesn’t include

excludes (a) Creditors (b) Suppliers
….…….,generally the least liquid asset (c) Investors (d) Executives
(a) Current ratio,(b) Liquid ratio, inventory
account receivable
(c) Gross profit margin,(d) Current ratio, average
Operating ratio collection period

3. As generally used in accounting, what is 8.  If sale on an accrual basis are Rs 5,00,000/- and
depreciation? accounts recievable increased by Rs 30,000/-, thecash
(a) It is a process of asset (b) It applies to only received from customers would be………..
valuation for balance long-lived intangible (a) Rs 5,00,000/- (b) Rs 4,70,000/-
sheet purposes assets
(c)It is used to indicate(d) It is an accouting (c) Rs 5,30,000/-(d) cannot be determined
a decline in market process which allocates
value of a long-lived long-lived asset cost
Asset to accounting periods

4 Revenue is generally recognised when the 9.  The form of Balance Sheet is……..
earning process is virtually complete and an
exchange has taken place. What principle is (a) Horizontal (b) Vertical
described herein? (c) Horizontal or vertical(d) None of the above
(a) Consistency(b) Matching
(c) Realisation (d) Conservatism
5. Dividend is paid on ………….
(a) Authorised Capital(b) Reserve Capital
(c) Issued Capital (d) Subscribed Capital that is
paid up
10. Which among the following is the limitation of
financial statement?
(a) Hinders the performance (b)Affected by window
of financial analysisdressing
(c) Lack of qualitative (d) All of the above
analysis

Section –B (20 Marks)

Q1. What are the objectives of preparing financial statement?

Q2. Write short notes on:

(a) What is deferred tax asset and deferred tax liability?
(b) Name two items which can be discussed under ‘Reserve and Surplus’.

Q3. Define liabilities. Mention important characteristics of liabilities. Which method would you adopt
for valuation of liabilities?
Q4. “Financial analysis is affected by window dressing and the personal ability and bias of the analyst.”
Comment.

Q5. What is revenue? What are the rules regarding revenue recognition?

Q6. What are comparative statements? Substantiate with example.

Q7. What is operating profit? How is it calculated? What is its significance?