NCERT Solutions is an extremely helpful resource while preparing for the CBSE Class 12 Accountancy examination. This study material provides students with in-depth knowledge of the concepts covered, and the NCERT solutions collated by the subject-matter experts are easy to understand.
NCERT Solutions for Class 12 Accountancy Chapter 4 – Analysis of Financial Statements provides students with all-inclusive data for all the concepts covered in the chapter. As the students would have learnt the basic concepts about the subject of Accountancy in Class 11, the Class 12 Solutions of NCERT is a continuation of it, which explains the concepts in a more detailed way.
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Short Questions for NCERT Accountancy Solutions Part 2 Class 12 Chapter 4
1. List the techniques of Financial Statement Analysis.
The most commonly used techniques of Financial Statement Analysis are as listed below:
1. Common Size Financial Statements
2. Trend Analysis
3. Comparative Financial Statements
4. Cash Flow Statement
5. Fund Flow Statement
6. Ratio Analysis
2. Distinguish between Vertical and Horizontal Analysis of financial data.
| Basis of Comparison | Horizontal Analysis | Vertical Analysis |
| Meaning | It is the comparative evaluation of a financial statement of two or more periods for calculating relative and absolute variances for every line of the item | It is the analysis of financial data, which is independent of time and items relating to the financial information of the company and its impact on the performance of the company. |
| Purpose | To specify changes in financial performance between two comparable accounting periods | To compare a financial item as a percentage of the base figure |
| Comparison of | Intra-firm comparison | Both intra and inter-firm comparison |
| Usefulness | The growth or decline of an item is represented here | It is useful in predicting and determining the relative proportion of an item in the financial statement to a common item in the financial statement |
3. State the meaning of Analysis and Interpretation.
Analysis and interpretation is a critical and systematic examination of the financial statement. It presents the financial data in a systematic manner and also establishes a cause-and-effect relationship with all the items of financial statements. Analysis and interpretation is all about presenting financial data which is self-explanatory and easy to understand. It helps users of accounting information in assessing the status of the financial performance of the business for a time period, and enables them to take proper decisions regarding the finance policy of the firm.
4. State the importance of Financial Analysis.
Financial analysis is of great importance for the various users of accounting information. Financial statements such as Balance Sheets, Income sheets and other sources of financial data provide ample information on the various expenses and sources of profit, loss and income, which is helpful in determining the financial status of a business. Financial data is not making any meaningful contribution until it is analysed. There are various methods which help in analysing financial statements and make them useful for various accounting users.
The following are the essential reasons for performing financial analysis:
1. It is very helpful in determining the financial viability and profit-earning capacity of the firm.
2. It is helpful in evaluating the business solvency in the long term
3. It is useful in comparing the financial status of a firm in comparison to other competitor firms
4. It helps management in decision-making and drafting plans and also establishes a robust and effective control mechanism
5. What are Comparative Financial Statements?
Comparative financial statements refer to statements which enable comparison that is both intra and inter-firm and is based on a period of time. These statements help various users of accounting information in evaluating the financial progress of a firm in relative terms. These statements express the data in absolute figures or as percentage change and absolute change that occurs in the item of the financial statement over a period of time. The data presented in financial statements are self-explanatory and easy to understand. When items of the financial statement are treated with the same accounting policies and practices over a fixed period of time, then the comparative data derived from such statements bear meaningful comparisons.
Two common types are as follows::
1. Comparative Income Statement
2. Comparative Balance Sheet
6. What do you mean by Common Size Statements?
Common Size Statements are those statements where the items are displayed as percentages of a common base figure instead of absolute figures. It is helpful for proper analysis between companies (inter-firm comparison) or between time periods of the same company (intra-firm comparison). In these statements, the relationship between items present in financial statements and common items like balance sheet, total and net sales are highlighted in percentage. The analysis based on these statements is called Vertical Analysis.
Two types of Common Size Statements are as follows:
1. Common Size Income Statements
2. Common Size Balance Sheet
Long Questions for NCERT Accountancy Solutions Part 2 Class 12 Chapter 4
1. Describe the different techniques of financial analysis and explain the limitations of financial analysis.
The following different techniques are used for financial analysis:
1. Cash Flow Analysis: This analysis focuses on the inflow and outflow of cash and cash equivalents from the various activities of a business, namely investing, operating and financing activities during an accounting period. This helps in analysing cash payments and the reason for receipt, and the respective changes in cash balances during the accounting year.
2. Ratio Analysis: This method highlights the relationship between items of the Balance Sheet and Income Statements. It is helpful in determining the efficiency, profitability and solvency of a firm. This analysis expresses the financial items as fractions, percentages or proportions. Also, it determines the qualitative relationship among different financial variables. It also serves as a source of information regarding the performance, viability and financial position of a firm.
3. Trend Analysis: This technique studies the trends in operating performance and financial position of the business over a period of many years in succession. In such a study, any particular year is considered as the base year, and the rest years are expressed as a percentage of the base year’s figures. It helps in identifying problems and inefficiency along with detecting operating efficiency and the financial position of the firm.
4. Comparative Statements: These statements use figures from two accounting periods that help determine financial position and profitability. It also enables to do intra and inter-firm comparisons and, therefore, determines the efficiency of the firm in relative terms. It uses both percentages as well as absolute terms. This analysis is known as Horizontal analysis.
5. Common Size Statements: Common Size Statements are those statements where the items are displayed as percentages of a common base figure instead of absolute figures. It is helpful for proper analysis between companies (inter-firm comparison) or between time periods of the same company (intra-firm comparison). In these statements, the relationship between items present in financial statements and common items like balance sheet, total and net sales are highlighted in percentage. The analysis based on these statements is called Vertical Analysis.
It has the following limitations:
1. It fails to depict changes in accounting policy and procedures.
2. These statements provide the interim report and hence have incomplete information.
3. These statements lack qualitative aspects like growth prospects and managerial efficiency and express only in monetary terms.
4. Financial analysis is based on accounting concepts and conventions and hence is unreliable as it does not take the current market value of items.
5. It involves personal bias and judgements of the accountant; for example, in the case of depreciation, different methods can be charged for the same item.
6. It does not take into account the change in the price level. Only nominal values are considered.
2. Explain the usefulness of trend percentages in the interpretation of the financial performance of a company.
Trend analysis is a form of analysing financial data, and it is expressed as a percentage for each year. It helps the accounting user in evaluating the financial performance of the business and also forms an opinion of various tendencies by which businesses can predict future trends.
The importance of trend analysis is as follows:
1. Predicting the trends of business which is forecasting future trends in business.
2. Trends are expressed as percentages which are less time-consuming and easy to follow.
3. It becomes a popular financial analysis method due to trends being expressed in percentages which makes evaluating the financial performance and operating efficiency of the firm relatively simpler.
4. It presents a broader picture of the performance of the company in terms of finance, viability and efficiency.
3. What is the importance of comparative statements? Illustrate your answer with particular reference to the comparative income statement.
Comparative statements have the following importance:
1. It presents financial data in a simple form, with year-wise data being presented in a side-by-side fashion, making the presentation neat and enabling intra and inter-firm comparisons more conclusive.
2. Presentation is very effective for drawing insights quickly and easily
3. It assists the management in drafting future plans and forecast trends which is achieved by analysing the profitability and operating efficiency of a business over time.
4. Comparative analysis helps the easy detection of problems. Early detection helps take corrective measures and align the business to meet the desired target.
4. What do you understand by analysis and interpretation of financial statements? Discuss its importance.
Financial analysis is of great importance for the various users of accounting information. Financial statements such as balance sheets, income sheets and other sources of financial data provide ample information on the various expenses and sources of profit, loss and income, which is helpful in determining the financial status of a business. Financial data is not making any meaningful contribution until it is analysed. There are various methods which help in analysing financial statements and make them useful for various accounting users.
The following reasons are essential for performing financial analysis:
1. It is very helpful in determining the financial viability and profit-earning capacity of the firm
2. It is helpful in evaluating the solvency of the business in the long term
3. It is useful in comparing the financial status of a firm in comparison to other competitor firms
4. It helps management in decision-making, drafting plans and also in establishing a robust and effective control mechanism
5. Explain how common size statements are prepared, giving an example.
Common size statements are of two types:
1. Common Size Income Statements
2. Common Size Balance Sheet
A common size statement is prepared as a columnar form for performing analysis. In such a statement, each item of the available financial statement is compared to a common item. Such analysis is called vertical analysis.
The following columns are present in a common size statement:
1. Particulars: It shows the various financial item under each respective heading
2. Amount Columns: Under these columns, the amount of each item is depicted along with sub-totals and the gross total of a particular year.
3. Percentage/Ratio Columns: Under these columns, the proportion of each item is shown as a percentage or ratio with reference to the common item.
It is prepared in the following two ways:
The following example will help get a better understanding of the preparation
Working Note:
For example,
Numerical Questions for NCERT Accountancy Solutions Part 2 Class 12 Chapter 4
1. Following are the balance sheets of Alpha Ltd. as on March 31st, 2016, and 2017:
| Particulars | 2016 ₹. |
2017 ₹. |
| I. Equity and Liabilities | ||
| Equity share capital | 2,00,000 | 4,00,000 |
| Reserves and surplus | 1,00,000 | 1,50,000 |
| Long-term borrowings | 2,00,000 | 3,00,000 |
| Short-term borrowings | 50,000 | 70,000 |
| Trade payables | 30,000 | 60,000 |
| Short-term provisions | 20,000 | 10,000 |
| Other current liabilities | 20,000 | 30,000 |
| Total | 6,20,000 | 10,20,000 |
| II. Assets | ||
| Fixed assets | 2,00,000 | 5,00,000 |
| Non-current investments | 1,00,000 | 1,25,000 |
| Current investments | 60,000 | 80,000 |
| Inventories | 1,35,000 | 1,55,000 |
| Trade receivables | 60,000 | 90,000 |
| Short term loans and advances | 40,000 | 60,000 |
| Cash at bank | 25,000 | 10,000 |
| Total | 6,20,000 | 10,20,000 |
| Comparative Balance Sheet
as on March 31, 2016, and 2017 |
||||
| Particulars | 2016
(₹) |
2017
(₹) |
Absolute Change | Percentage Change |
| I. Equity and Liabilities | ||||
| 1. Shareholder’s Fund | ||||
| a. Equity Share Capital | 2,00,000 | 4,00,000 | 2,00,000 | 100 |
| b. Reserves and Surplus | 1,00,000 | 1,50,000 | 50,000 | 50 |
| 2. Non-Current Liabilities | ||||
| a. Long Term Borrowings | 2,00,000 | 3,00,000 | 1,00,000 | 50 |
| 3. Current Liabilities | ||||
| a. Short Term Borrowings | 50,000 | 70,000 | 20,000 | 40 |
| b. Trade Payables | 30,000 | 60,000 | 30,000 | 100 |
| c. Short Term Provisions | 20,000 | 10,000 | (10,000) | (50) |
| d. Other Current Liabilities | 20,000 | 30,000 | 10,000 | 50 |
| Total | 6,20,000 | 10,20,000 | 4,00,000 | 64.5 |
| II. Assets | ||||
| 1. Non-Current Assets | ||||
| a. Fixed Assets | 2,00,000 | 5,00,000 | 3,00,000 | 150 |
| b. Non-current Investments | 1,00,000 | 1,25,000 | 25,000 | 25 |
| 2. Current Assets | ||||
| a. Current Investments | 60,000 | 80,000 | 20,000 | 33.3 |
| b. Inventories | 1,35,000 | 1,55,000 | 20,000 | 14.8 |
| c. Trade Receivables | 60,000 | 90,000 | 30,000 | 50 |
| d. Short Term Loans and Advances | 40,000 | 60,000 | 20,000 | 50 |
| e. Cash and Cash Equivalents | 25,000 | 10,000 | (15,000) | (60) |
| Total | 6,20,000 | 10,20,000 | 4,00,000 | 64.5 |
2. Following are the balance sheets of Beta Ltd. as on March 31st, 2016 and 2017:
| Particulars | 2017 ₹. |
2016 ₹. |
| I. Equity and Liabilities | ||
| Equity share capital | 4,00,000 | 3,00,000 |
| Reserves and surplus | 1,50,000 | 1,00,000 |
| Loan from IDBI | 3,00,000 | 1,00,000 |
| Short-term borrowings | 70,000 | 50,000 |
| Trade payables | 60,000 | 30,000 |
| Short-term provisions | 10,000 | 20,000 |
| Other current liabilities | 1,10,000 | 1,00,000 |
| Total | 11,00,000 | 7,00,000 |
| II. Assets | ||
| Fixed assets | 4,00,000 | 2,20,000 |
| Non-current investments | 2,25,000 | 1,00,000 |
| Current investments | 80,000 | 60,000 |
| Stock | 1,05,000 | 90,000 |
| Trade receivables | 90,000 | 60,000 |
| Short term loans and advances | 1,00,000 | 85,000 |
| Cash and cash equivalents | 1,00,000 | 85,000 |
| Total | 11,00,000 | 7,00,000 |
| Comparative Balance Sheet
as on March 31, 2016, and 2017 |
||||
| Particulars | 2016
(₹) |
2017
(₹) |
Absolute Change | Percentage Change |
| I. Equity and Liabilities | ||||
| 1. Shareholder’s Fund | ||||
| Â a. Equity Share Capital | 3,00,000 | 4,00,000 | 1,00,000 | 33.3 |
| Â b. Reserves and Surplus | 1,00,000 | 1,50,000 | 50,000 | 50 |
| 2. Non-Current Liabilities | ||||
| a. Long Term Borrowings
(Loan from IDBI) |
1,00,000 | 3,00,000 | 2,00,000 | 200 |
| 3. Current Liabilities | ||||
| Â a. Short Term Borrowings | 50,000 | 70,000 | 20,000 | 40 |
| Â b. Trade Payables | 30,000 | 60,000 | 30,000 | 100 |
| Â c. Short Term Provisions | 20,000 | 10,000 | (10,000) | (50) |
| Â d. Other Current Liabilities | 1,00,000 | 1,10,000 | 10,000 | 10 |
| Total | 7,00,000 | 11,00,000 | 4,00,000 | 57.14 |
| II. Assets | ||||
| 1. Non-Current Assets | ||||
| Â a. Fixed Assets | 2,20,000 | 4,00,000 | 1,80,000 | 81.8 |
| Â b. Non-current Investments | 1,00,000 | 2,25,000 | 1,25,000 | 125 |
| 2. Current Assets | ||||
| Â a. Current Investments | 60,000 | 80,000 | 20,000 | 33.3 |
| Â b. Inventories (Stock) | 90,000 | 1,05,000 | 15,000 | 16.6 |
| Â c. Trade Receivables | 60,000 | 90,000 | 30,000 | 50 |
| Â d. Short Term Loans and Advances | 85,000 | 1,00,000 | 15,000 | 17.65 |
| Â e. Cash and Cash Equivalents | 85,000 | 1,00,000 | 15,000 | 17.65 |
| Total | 7,00,000 | 11,00,000 | 4,00,000 | 57.14 |
3. Prepare a Comparative Income Statement from the following information:
| Particulars | 2016-17 ₹. |
2015-16 ₹. |
| Freight Outward | 20,000 | 10,000 |
| Wages (office) | 10,000 | 5,000 |
| Manufacturing Expenses | 50,000 | 20,000 |
| Stock adjustment | (60,000) | 30,000 |
| Cash purchases | Â 80,000 | 60,000 |
| Credit purchases | Â 60,000 | 20,000 |
| Returns inward | Â 8,000 | 4,000 |
| Gross profit | (30,000) | 90,000 |
| Carriage outward | 20,000 | 10,000 |
| Machinery | 3,00,000 | 2,00,000 |
| Charge 10% depreciation on machinery | 10,000 | 5,000 |
| Interest on short-term loans | 20,000 | 20,000 |
| 10% debentures | 20,000 | 10,000 |
| Profit on sale of furniture | 20,000 | 10,000 |
| Loss on sale of the office car | 90,000 | 60,000 |
| Tax rate | 40% | 50% |
| Comparative Income Statement
for the year ended March 31, 2016, and 2017 |
|||||
| Particulars | Note
No. |
2015-16
(₹) |
2016-17
(₹) |
AbsoluteÂ
Change |
Percentage
Change |
| 1. Revenue from Operations | 2,16,000 | 92,000 | (1,24,000) | (57.4) | |
| 2. Other Income | 10,000 | 20,000 | 10,000 | 100 | |
| 3. Total Revenue (1 + 2) | 2,26,000 | 1,12,000 | (1,14,000) | (50.44) | |
| 4. Expenses | |||||
| a. Purchases of Stock-in-Trade | 80,000 | 1,40,000 | 60,000 | 75 | |
| b. Change in Inventories | 30,000 | (60,000) | (90,000) | (300) | |
| c. Employee Benefit Expenses | 5,000 | 10,000 | 5,000 | 100 | |
| d. Finance Costs | 21,000 | 22,000 | 1,000 | 4.54 | |
| e. Depreciation and Amortisation Expenses | 5,000 | 10,000 | 5,000 | 100 | |
| f. Other Expenses | 80,000 | 1,30,000 | 50,000 | 62.5 | |
| Â Total Expenses | 2,21,000 | 2,52,000 | 31,000 | 14.03 | |
| 5. Profit before Tax (3 – 4) | 5,000 | (1,40,000) | (83,000) | 16.6 | |
| Â Â Â Â Â Less: Income Tax | 2,500 | – | (2,500) | (100) | |
| 6. Profit After Tax | 2,500 | (1,40,000) | (1,37,500) | 55 | |
Working Notes:
1. Calculation of Net Sales
Net Sales = Cost of Goods Sold + Gross Profit – Sales Return
or, Net Sales = Purchases + Manufacturing Expenses + Change in Inventory + Gross Profit – Sales Return
Net Sales (2016) = 80,000 + 20,000 +30,000 + 90,000 – 4,000 = ₹ 2, 16,000
Net Sales (2017) = 1, 40,000 + 50,000 – 60,000 – 30,000 – 80,000 = ₹ 92,000
2. Calculation of Finance Cost
Finance Cost = Interest on short-term loans + Interest on 10% Debentures
Finance Cost (2016) = 20,000 + 1,000 = ₹ 21,000
Finance Cost (2017) = 20,000 + 2,000 = ₹ 22,000
3. Calculation of Other Expenses
Other Expenses = Freight Outward + Carriage Outward + Loss on sale of the office car
Other Expenses (2016) = 10,000 + 10,000 + 60,000 = ₹ 80,000
Other Expenses (2017) = 20,000 + 20,000 + 90,000 = ₹ 1, 30,000
4. Prepare a Comparative Income Statement from the following information:
| Particulars | 2015-16 ₹. |
2016-17 ₹. |
| Manufacturing expenses | 35,000 | 80,000 |
| Opening stock | 30,000 | 60% of closing stock |
| Sales | 9,60,000 | 4,50,000 |
| Returns outward | 4,000 (out of credit purchase) | 6,000 (out of cash purchase) |
| Closing stock | 150% of opening stock | 1,00,000 |
| Credit purchases | 1,50,000 | 150% of cash purchase |
| Cash purchases | 80% of credit purchases | 40,000 |
| Carriage outward | 10,000 | 30,000 |
| Building | 1,00,000 | 2,00,000 |
| Depreciation on building | 20% | 10% |
| Interest on bank overdraft | 5,000 | – |
| 10% debentures | 2,00,000 | 20,00,000* |
| Profit on sale of copyright | 10,000 | 20,000 |
| Loss on sale of personal car | 10,000 | 20,000 |
| Other operating expenses | 20,000 | 10,000 |
| Tax rate | 50% | 40% |
*There is a misprint in the book; this should be 2,00,000
| Comparative Income Statement
for the years ended March 31, 2016, and 2017 |
|||||
| Particulars | Note
 No. |
2015-16
(₹) |
2016-17
(₹) |
AbsoluteÂ
Change |
Percentage
Change |
| 1. Revenue from Operations | 9,60,000 | 4,50,000 | (5,10,000) | (53.13) | |
| 2. Other Income | 10,000 | 20,000 | 10,000 | 100 | |
| 3. Total Revenue (1 + 2) | 9,70,000 | 4,70,000 | (5,00,000) | (51.55) | |
| 4. Expenses | |||||
| a. Purchases of Stock-in-Trade | 2,66,000 | 94,000 | (1,72,000) | (64.7) | |
| b. Change in Inventories | (15,000) | (40,000) | (55,000) | (366.7) | |
| c. Finance Costs | 25,000 | 20,000 | (5,000) | (20) | |
| d. Depreciation and Amortisation Expenses | 20,000 | 20,000 | – | – | |
| e. Other Expenses | 30,000 | 40,000 | 10,000 | 33.33 | |
| Â Total Expenses | 3,26,000 | 1,34,000 | (1,92,000) | 58.90 | |
| 5. Profit before Tax (3 – 4) | 6,44,000 | 3,36,000 | (3,08,000) | 47.83 | |
| Â Â Â Â Â Less: Income Tax | 3,22,000 | 1,34,400 | (1,87,600) | 58.26 | |
| 6. Profit After Tax | 3,22,000 | 2,01,600 | 1,20,400 | 37.39 | |
Working Notes:
1. Calculation of Net Purchases and Change in Inventory
2. Calculation of Finance Cost
Finance Cost = Interest on Bank Overdraft + Interest on Debentures
Finance Cost (2016) = 5,000 + 20,000 = ₹ 25,000
Finance Cost (2017) = 0 + 20,000 = ₹ 20,000
3. Calculation of Other Expenses
Other Expenses = Carriage outward + other operating expenses
Other Expenses (2016) = 10,000 + 20,000 = ₹ 30,000
Other Expenses (2017) = 30,000 + 10,000 = ₹ 40,000
5. Prepare a common size statement of profit and loss of Shefali Ltd. with the help of the following information:
| Particulars | 2015-16 (₹) |
2016-17 (₹) |
| Revenue from operations | Â 6,00,000 | 8,00,000 |
| Indirect expense | Â 25% of gross profit | 25% of gross profit |
| Cost of revenue from operations | Â 4,28,000 | 7,28,000 |
| Other incomes | 10,000 | 12,000 |
| Income tax | 30% | Â 30% |
| Common Size Income Statement
for the years ended March 31, 2016, and 20174 |
|||||
| Particulars | Note
No. |
2015-16
(₹) |
2016-17
(₹) |
Percentage of
Sales |
|
| 2015-16 | 2016-17 | ||||
| 1. Revenue from Operations | 6,00,000 | 8,00,000 | 100 | 100 | |
| 2. Other Income | 10,000 | 12,000 | 1.67 | 1.5 | |
| 3. Total Revenue (1 + 2) | 6,10,000 | 8,12,000 | 101.67 | 101.5 | |
| 4. Expenses | |||||
| a. Cost of Revenue from Operations (COGS) | 4,28,000 | 7,28,000 | 71.33 | 91 | |
| b. Other Expenses | 43,000 | 18,000 | 7.17 | 2.25 | |
| Â Total Expenses | 4,71,000 | 7,46,000 | 78.5 | 93.25 | |
| 5. Profit before Tax (3 – 4) | 1,39,000 | 66,000 | 23.167 | 8.25 | |
| Â Â Â Â Â Less: Income Tax | (41,700) | (19,800) | 5.35 | ||
| 6. Profit After Tax | 97,300 | 46,200 | 16.22 | 5.775 | |
Working Notes:
1. Calculation of expenses
Other Expenses = Indirect Expenses = % of Gross Profit
Gross Profit = Net Sales −- Revenue from Operations
For 2016, Gross Profit = ₹(6,00,000 −- 4,28,000) = ₹1,72,000
For 2017, Gross Profit = ₹(8,00,000 −- 7,28,000) = ₹72,000
2016=1,72,000×25%=₹43,000
2017=72,000×25%=₹18,000
2016=1, 72,000×25%=₹43,000
2017=72,000×25%=₹18,000
6. Prepare a common size balance sheet from the following balance sheet of Aditya Ltd. and Anjali Ltd.:
| Particulars | Aditya Ltd. ₹. |
Anjali Ltd. ₹. |
| I. Equity and Liabilities | ||
| a) Equity share capital | 6,00,000 | 8,00,000 |
| b) Reserves and surplus | 3,00,000 | 2,50,000 |
| c) Current liabilities | 1,00,000 | 1,50,000 |
| Total | 10,00,000 | 12,00,000 |
| II. Assets | ||
| a) Fixed assets | Â 4,00,000 | 7,00,000 |
| b) Current assets | Â 6,00,000 | 5,00,000 |
| Total | 1,00,0000* | 12,00,000 |
*The total liabilities side must be equal to the total assets side; therefore, it should be 10,00,000.
| Common Size Balance Sheet | ||||
| Particulars | Aditya Ltd.
(₹) |
Anjali Ltd.Â
(₹) |
% of Total | |
| Aditya Ltd. | Anjali Ltd. | |||
| I. Equity and Liabilities | ||||
| 1. Shareholder’s Fund | ||||
| a. Equity Share Capital | 6,00,000 | 8,00,000 | 60 | 66.67 |
| b. Reserves and Surplus | 3,00,000 | 2,50,000 | 30 | 20.83 |
| 2. Current Liabilities | 1,00,000 | 1,50,000 | 10 | 12.5 |
| Total | 10,00,000 | 12,00,000 | 100 | 100 |
| II. Assets | ||||
| 1. Non-Current Assets | ||||
| a. Fixed Assets | 4,00,000 | 7,00,000 | 40 | 58.33 |
| Â 2. Current Assets | 6,00,000 | 5,00,000 | 60 | 41.67 |
| Total | 10,00,000 | 12,00,000 | 100 | 100 |
Concepts covered in this chapter are listed below:
- Meaning of financial analysis
- Significance of financial analysis
- Trend analysis
- Tools of financial analysis
- Limitations of financial analysis
Conclusion
NCERT Solutions for Class 12 Accountancy Chapter 4 provides a wide range of illustrative examples, which assists the students in comprehending and learning quickly. The above-mentioned are the solutions as per the Class 12 CBSE syllabus. For more solutions and study materials of NCERT Solutions for Class 12 Accountancy, visit BYJU’S or download BYJU’S – The Learning App for more information.
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