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Important Questions and Answers for Class 12 Accountancy Chapter 3 Financial Statements of a Company 2025-26

Q: 1. What types of important questions are usually asked from Class 12 Accountancy Chapter 3 – Financial Statements of a Company?

Most exams feature a mix of MCQs, very short, short, long, and case-based questions on this chapter. Be ready for format-based queries, numerical problems, and definitions. Practice key differences, schedule III layouts, and typical numericals to cover all expected question types as per CBSE guidelines.

Q: 2. How should I revise important questions from "Financial Statements of a Company" for maximum exam marks?

Focus on high-weightage subtopics and solve past year’s important questions. Revise using topic-wise notes and practice with chapter-wise important questions pdf. Cover the following:Balance sheet formats with schedulesNumerical sumsTheory on main headings and definitions

Q: 3. Where can I download important questions with answers as a PDF for this chapter?

You can download accountancy class 12 important questions chapter wise pdf and financial statements of a company class 12 solutions pdf from Vedantu’s official chapter page. PDF downloads provide exam-focused questions and answers for offline revision and practice.

Q: 4. What are some high-scoring answer tips for important questions in this chapter?

Always use CBSE keywords and stepwise working. For theory, start with a definition, follow with explanation or points, and end with an example if possible. For numericals, show proper workings and label schedules clearly. Underline important terms to grab examiner’s attention.

Q: 5. Are diagrams and formats (like balance sheet layouts) essential for answering important questions?

Yes, drawing company balance sheet formats and labeling schedules is vital for questions on presentation or format. Marks are often awarded for correct headings, columns, and proper arrangement, so practice these layouts along with supporting notes from your financial statements of a company class 12 notes.

Q: 7. Which subtopics should I prioritize while practicing important questions for Financial Statements of a Company Class 12?

Start with balance sheet and statement of profit and loss format, then focus on main schedule headings, definitions of assets and liabilities, common numericals, and case-based scenarios. Prioritizing these ensures coverage of most frequent and high-weightage important questions in the exam.

Financial Statements of a Company Class 12 Solutions PDF for Practice and Exam Preparation

On this page, you will find Important Questions Class 12 Accountancy Part 2 Chapter 3 Financial Statements of a Company. This resource is designed for Class 12 students studying Accountancy, focusing on Financial Statements of a Company as per NCERT guidelines. All questions follow the latest syllabus and exam pattern for Chapter 3.

Understanding the concepts in this chapter is easier with our accountancy class 12 important questions pdf download. Practice questions cover all types—MCQs, short answers, long format, and case-based—matching what appears in CBSE exams. Each answer is stepwise and uses important CBSE marking keywords.

These Vedantu’s Important Questions with Answers help you revise quickly and score more in your board exams. Grasp theory, solve numericals, and avoid common mistakes with these high-yield questions. Click to get your free Important Questions PDF and start preparing now.

Financial Statements of a Company Class 12 Solutions PDF for Practice and Exam Preparation

1. Multiple choice questions.

1. Which of the following is NOT included in the financial statements of a company as per Schedule III of the Companies Act, 2013?

(a) Balance Sheet
(b) Statement of Profit and Loss
(c) Statement of Affairs
(d) Cash Flow Statement

Answer: (c) Statement of Affairs

2. The main purpose of financial statements is to:

(a) Show historical cost only
(b) Provide information to users
(c) Comply with Income Tax Act
(d) Calculate net present value

Answer: (b) Provide information to users

3. In company financial statements, which format is mandatory for presenting the Balance Sheet?

(a) Horizontal
(b) Vertical
(c) Both permitted
(d) No specific format

Answer: (b) Vertical

2. Very Short Answer (VSA).

1. What is meant by financial statements?

Answer: Financial statements are formal annual reports presenting financial information about a company to its owners and external users, comprising the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement.

2. Name any two objectives of financial statements.

Answer: Two objectives of financial statements are to provide information about economic resources and obligations and to disclose accounting policies.

3. Mention any one limitation of financial statements.

Answer: Financial statements do not show current market values of assets and liabilities, reflecting only historical costs.

3. Short Answer Questions.

1. Explain the significance of preparing financial statements for a company.

Answer: Preparing financial statements is significant as they act as a performance report for shareholders, help investors and creditors assess financial health, support policy decisions for governments, and provide necessary information for trade associations and the stock exchange for decision-making and oversight.

2. Enumerate any three major elements presented under ‘Equity and Liabilities’ in the Balance Sheet as per Schedule III.

Answer: The three major elements presented under ‘Equity and Liabilities’ are: (i) Shareholder’s Funds (which includes share capital and reserves), (ii) Non-current Liabilities (such as long-term borrowings), and (iii) Current Liabilities (like short-term borrowings and payables).

3. Briefly discuss the nature of financial statements.

Answer: The nature of financial statements is such that they are based on recorded facts, governed by accounting conventions and assumptions, and influenced by personal judgments, making them partly subjective and limited in presenting the real financial position.

4. True or False Questions.

1. Financial statements include only the Balance Sheet and Statement of Profit and Loss.

Answer: False

2. Disclosure of certain information in notes or on the face of financial statements is optional for companies.

Answer: False

3. The vertical format of the Balance Sheet is prescribed for companies as per Schedule III.

Answer: True

3. Fill in the Blanks Questions.

1. Financial statements are prepared in accordance with __________ of the Companies Act, 2013.

Answer: Schedule III

2. In a company's Balance Sheet, Inventory is shown under the head __________.

Answer: Current Assets

3. Personal judgments in financial statements may affect estimation of __________ and __________.

Answer: depreciation, inventory valuation

Advantages of Understanding Financial Statements for Class 12 Students

Learning about financial statements of a company class 12 solutions pdf helps you understand business performance. These concepts are vital for scoring well in CBSE exams. With accountancy class 12 important questions pdf download, revision is simpler and thorough for all main topics.

Practicing financial statements of a company class 12 important questions makes it easy to remember key points like the Balance Sheet format and uses of financial statements. These questions highlight important concepts needed for future studies in finance and accounting.

Access to clear financial statements of a company class 12 notes with answers supports better exam preparation. Downloading important questions for class 12 accountancy chapter wise pdf ensures you cover the entire syllabus, helping students feel confident before final exams.

FAQs on Important Questions and Answers for Class 12 Accountancy Chapter 3 Financial Statements of a Company 2025-26

1. What types of important questions are usually asked from Class 12 Accountancy Chapter 3 – Financial Statements of a Company?

Most exams feature a mix of MCQs, very short, short, long, and case-based questions on this chapter. Be ready for format-based queries, numerical problems, and definitions. Practice key differences, schedule III layouts, and typical numericals to cover all expected question types as per CBSE guidelines.

2. How should I revise important questions from "Financial Statements of a Company" for maximum exam marks?

Focus on high-weightage subtopics and solve past year’s important questions. Revise using topic-wise notes and practice with chapter-wise important questions pdf. Cover the following:

Balance sheet formats with schedules
Numerical sums
Theory on main headings and definitions

3. Where can I download important questions with answers as a PDF for this chapter?

You can download accountancy class 12 important questions chapter wise pdf and financial statements of a company class 12 solutions pdf from Vedantu’s official chapter page. PDF downloads provide exam-focused questions and answers for offline revision and practice.

4. What are some high-scoring answer tips for important questions in this chapter?

Always use CBSE keywords and stepwise working. For theory, start with a definition, follow with explanation or points, and end with an example if possible. For numericals, show proper workings and label schedules clearly. Underline important terms to grab examiner’s attention.

5. Are diagrams and formats (like balance sheet layouts) essential for answering important questions?

Yes, drawing company balance sheet formats and labeling schedules is vital for questions on presentation or format. Marks are often awarded for correct headings, columns, and proper arrangement, so practice these layouts along with supporting notes from your financial statements of a company class 12 notes.

6. How do I avoid common mistakes in solving important questions from Chapter 3?

To avoid losing marks, never mix up assets and liabilities, and always attach required schedules. Using incorrect headings or skipping value points leads to deductions. Double-check calculations in numericals and include all necessary tags in your answers.

7. Which subtopics should I prioritize while practicing important questions for Financial Statements of a Company Class 12?

Start with balance sheet and statement of profit and loss format, then focus on main schedule headings, definitions of assets and liabilities, common numericals, and case-based scenarios. Prioritizing these ensures coverage of most frequent and high-weightage important questions in the exam.