1) Debtors = ₹5,00,000; Bills receivable= ₹3,00,000; credit sales= ₹ 6,00,000; Debtors

turnover ratio= ?
a) 4:3
b) 3:4
c) 1:3
d) 3:1

2) If debt service coverage ratio is 3 times then it shows

a) Low amount of profit available for dividend
b) Weak debt servicing capacity
c) Strong capacity to pay interest
d) Difficulty in fresh loan

3) The relationship between capital entitled to fixed rate of

return and the capital not so entitled to fixed rate of return is
known as:
(a) Fixed Capital
(b) Working Capital
(c) Gearing Capital
(d) owned Capital .

4) Decrease in gross profit ratio may be due to

a) Decrease in cost of goods sold
b) Increase in selling price
c) Overvaluation of Stock (closing)
d) Decrease in cost of materials.

5) The relationship between net operating profit and net sales is

expressed in __________________.
(a) Percentage (b) Figures (c) Ratios (d) Standard Deviation.

6) Leverage ratio measures the relationship between

proprietor’s fund and _______________.
a) Sinking fund
b) Loan fund
c) Borrowed fund
d) Net profit

7) Debt service ratio shows relationship between _______ and

interest payable on loans.
a) Gross profit
b) Gross loss
c) Net profit
d) Net loss

8) _________ ratio studies the relationship between cost of activities

and net sales
a) Gross profit ratio
 b) Operating ratio
c) Capital gearing ratio
d) Debt service ratio

9) which of the following is not an example of combine or composite ratio

a) Dividend payout ratio
b) Debt service ratio
c) Stock turnover ratio
d) Return on equity share capital

10) which of the following is not an example of Revenue statement ratio

a) Net operating profit ratio
b) Stock turnover ratio
c) Operating ratio
d) Stock working capital ratio

11) which of the following is an example of balance sheet ratio

a) Debt service ratio
b) Debtors turnover ratio
c) Creditors turnover ratio
d) Debt equity ratio

12) Gross profit ratio = 20%, Sales = ₹2,50,000 , Gross profit = ?

a) ₹50,000
b) ₹40,000
c) ₹5000
d) ₹4000

13) opening stock= ₹60,000 , closing stock = ₹40,000 , Cost of goods sold = ₹2,00,000 ,find
stock turnover ratio?
a) 1:4
b) 4:1
c) 1:2
d) 2:1

14) If current ratio is 3:1, the amount of current assets is ₹6,00,000. What will be the current
liability?
a) ₹7,00,000
b) ₹2,00,000
c) ₹5,00,000
d) ₹1,00,000

15) cost of goods sold is ₹ 6,00,000 ; operating expenses is ₹1,75,000; net sales is ₹
10,00,000; operating ratio is ______?
a) 77.50%
b) 50.50%
c) 55.55%
d) 60%
16) current ratio is 4.5, liquid ratio is 3, inventory is ₹36,000, the liquid assets will be _____
a) ₹72,000
b) ₹50,000
c) ₹62,000
d) ₹80,000

17) Fixed assets ₹10,00,000 ; current assets ₹5,00,000; current liabilities ₹ 2,00,000; capital
employed is _______
a) ₹13,00,000
b) ₹10,00,000
c) ₹5,00,000
d) ₹4,00,000

18) ______ is a profitability ratio.

a) Current ratio
b) Quick ratio
c) Acid test ratio
d) Operating ratio

19) _____ ratio is useful for long term creditors.

a) Current ratio
b) Return on equity capital
c) Expenses ratio
d) Debt equity ratio

20) If inventory is ₹ 70,000, working capital is ₹ 1,00,000 and current liabilities is ₹ 1,50,000
then what is stock to working capital ratio?
a) 70%
b) 46.66%
c) 66.66%
d) 88.88%