DK Goel Class 12 Solutions Available on Vedantu for Free Download
FAQs on Financial Statement Analysis: DK Goel Class 12
1. How do Vedantu's DK Goel solutions for Chapter 2 help in understanding Financial Statement Analysis?
Vedantu's DK Goel solutions for Class 12, Chapter 2 provide a clear, step-by-step methodology for each problem. They focus on correctly applying the formats prescribed by Schedule III of the Companies Act, 2013, which is crucial for board exams. By breaking down complex calculations for Comparative and Common-Size Statements, these solutions help you understand the logic behind the analysis, not just memorise the steps.
2. What are the main types of problems covered in DK Goel's Class 12 chapter on Financial Statement Analysis?
This chapter in the DK Goel textbook primarily focuses on the practical application of the main tools for financial analysis. The problems you will learn to solve are centred around:
Preparing the Statement of Profit and Loss and Balance Sheet as per the prescribed Schedule III format.
Constructing Comparative Statements (both Balance Sheet and P&L) to analyse changes over two periods.
Developing Common-Size Statements (both Balance Sheet and P&L) to understand the proportion of each item relative to a common base.
3. How does mastering Comparative and Common-Size Statements in DK Goel Chapter 2 help with later chapters like Accounting Ratios?
Mastering Comparative and Common-Size Statements builds a critical foundation for the chapter on Accounting Ratios. These statements organise financial data and highlight trends or structural compositions. For example, a Comparative Statement shows the absolute and percentage change in items like revenue or debt, which is then further analysed using ratios. Similarly, a Common-Size Statement provides the proportional data needed to calculate many profitability and solvency ratios. Without a clear understanding of these statements, ratio analysis becomes abstract and difficult.
4. Which part of the CBSE Class 12 Accountancy syllabus (2025-26) does DK Goel's chapter on Financial Statement Analysis cover?
This chapter is part of Part B: Analysis of Financial Statements in the official CBSE Class 12 Accountancy syllabus for the 2025-26 session. It specifically falls under Unit 3, which introduces the meaning, significance, and tools of financial analysis. This is separate from Part A, which covers Accounting for Partnership Firms and Companies.
5. What is the key analytical difference between preparing a Comparative Statement and a Common-Size Statement as per DK Goel's solutions?
The key difference lies in their analytical purpose. A Comparative Statement is used for trend analysis, showing how individual items on the Balance Sheet or P&L have changed over two or more accounting periods. It helps in understanding the growth or decline of the business. In contrast, a Common-Size Statement is used for structural analysis. It expresses every item as a percentage of a common base (e.g., Total Assets or Revenue from Operations), revealing the internal financial structure of the company for a single period and allowing for comparison with other firms in the industry.
6. What is the correct method to solve a problem on a Common-Size Balance Sheet from the DK Goel textbook?
To correctly solve a problem on a Common-Size Balance Sheet, follow these steps as per the CBSE 2025-26 guidelines:
Step 1: Draw the vertical format of the Balance Sheet strictly as per Schedule III of the Companies Act, 2013.
Step 2: Enter the absolute figures for all assets, equity, and liabilities for the given period(s).
Step 3: Take the total of the 'Equity and Liabilities' side (which is equal to the 'Total Assets') as the base, representing 100%.
Step 4: Calculate the percentage of each individual item on the Balance Sheet in relation to this base total. The formula is: (Individual Item / Total of Balance Sheet) * 100.
Step 5: Present these percentages in a separate column next to the absolute figures.
7. Why is it so important to strictly follow the Schedule III format when solving problems from DK Goel's Financial Statement Analysis chapter for the board exam?
Following the Schedule III format is not just a textbook rule; it is a legal requirement under the Companies Act, 2013, for all companies to present their financial statements. In the CBSE board exams, marks are specifically allocated for the correct presentation and format. Any deviation, such as incorrect major headings (e.g., Non-Current Assets) or sub-headings (e.g., Property, Plant & Equipment), can lead to a significant loss of marks. Therefore, mastering the format using DK Goel's problems is essential for ensuring uniformity, comparability, and scoring full marks in related questions.
