Accounting Ratios MCQs for Class 12: Exam Practice, Formulas & Tips
MCQs for Accountancy Class 12 Chapter 9 (Accounting Ratios) are an essential resource for mastering financial statement analysis for school exams, competitive tests, and daily business applications. These questions help students check their understanding, improve accuracy, and prepare effectively for the CBSE Board and other important assessments.
| Ratio Name | Formula | Usage |
|---|---|---|
| Current Ratio | Current Assets ÷ Current Liabilities | Measures short-term solvency |
| Quick Ratio (Acid Test) | (Current Assets – Inventories) ÷ Current Liabilities | Assesses liquidity minus stocks |
| Debt-Equity Ratio | Total Debt ÷ Shareholders’ Equity | Evaluates long-term solvency |
| Return on Investment (ROI) | Net Profit ÷ Capital Employed × 100 | Shows overall profitability |
| Inventory Turnover Ratio | Cost of Goods Sold ÷ Average Inventory | Assesses stock management |
MCQs for Accountancy Class 12 Chapter 9: Accounting Ratios
Practicing MCQs for Accountancy Class 12 Chapter 9 helps strengthen core concepts on accounting ratios, analyses, and exam patterns. These objective questions not only check knowledge but also develop speed and precision for board and other competitive exams. Below are important sample MCQs with solutions:
-
Working Capital is the:
(a) Cash and Bank Balance
(b) Capital borrowed from the Banks
(c) Difference between Current Assets and Current Liabilities
(d) Difference between Current Assets and Fixed Assets
Answer: (c) Difference between Current Assets and Current Liabilities -
Which ratio is complementary to each other?
(a) Current and liquid ratio
(b) Operating and operating profit ratio
(c) Gross and net profit ratio
(d) Trade receivable and trade payable ratio
Answer: (b) Operating and operating profit ratio -
Net Profit can be greater than Operating Profit when:
(a) Cost of Revenue from Operations is more than Operating Expenses
(b) Operating Expenses are more than Non-operating Expenses
(c) Non-operating Expenses are more than Non-operating Income
(d) Non-operating Expenses are less than Non-operating Income
Answer: (d) Non-operating Expenses are less than Non-operating Income -
A company’s Current Ratio is 2:1. After cash payment to some of its creditors, Current Ratio will:
(a) Decrease
(b) As before
(c) Increase
(d) None of these
Answer: (c) Increase -
Debt equity ratio is a measure of:
(a) Short term solvency ratio
(b) Profitability ratio
(c) Long term solvency ratio
(d) Activity ratio
Answer: (c) Long term solvency ratio
You can download a complete MCQ set with answer keys for offline practice from the provided link. This will support effective last-minute revisions and exam readiness.
Key Accounting Ratio Formulas for Revision
| Type | Key Ratio | Formula | Application |
|---|---|---|---|
| Liquidity | Current Ratio | Current Assets ÷ Current Liabilities | Short-term financial position |
| Liquidity | Quick Ratio | (Current Assets – Inventory) ÷ Current Liabilities | Immediate liquidity |
| Solvency | Debt-Equity Ratio | Total Debts ÷ Shareholders’ Funds | Long-term risk |
| Profitability | ROI | Net Profit ÷ Capital Employed × 100 | Overall returns |
| Activity | Inventory Turnover | Cost of Goods Sold ÷ Average Inventory | Stock efficiency |
Exam Tips and Common Mistakes in Accounting Ratio MCQs
- Read the MCQ questions carefully for keywords like "least," "most," or "not."
- Always verify units and currency in calculations.
- Use the correct formula for each ratio; memorize them with practical examples.
- Don’t skip question steps—write out the working if allowed.
- Review similar terms; e.g., “Quick Ratio” vs. “Current Ratio.”
Download Free PDF: Class 12 Accountancy Chapter 9 MCQs
For convenient offline practice and mobile-friendly revision, download the complete set of MCQs for Accountancy Class 12 Chapter 9 with answer keys. Download Chapter 9 MCQ PDF here for free. Use this during last-minute board exam preparation.
Why Practice MCQs for Accountancy Class 12 Chapter 9?
Regular MCQ practice helps students gain confidence, reduce anxiety, and develop fast problem-solving skills for board and entrance exams. MCQs also build a strong base in accounting ratios, which are commonly asked in school projects and interviews.
Internal Links for In-Depth Study
- Accounting Ratios – Learn every type of ratio in detail.
- Analysis of Financial Statements – Deep dive into statement interpretation.
- Ratio Analysis – Explore concepts and solved examples.
- Profitability Ratios – Review detailed formula applications.
- Financial Statements of a Company – Understand balance sheet and P&L formats for MCQs.
At Vedantu, we simplify Commerce topics such as accounting ratios to help students get board-ready. Practice, revise, and explore connected chapters using our curated resources.
In summary, mastering MCQs for Accountancy Class 12 Chapter 9 ensures you’re exam-ready and confident with financial statement analysis. Use formula tables, solve objective questions, and leverage Vedantu’s clear explanations for effective learning and higher exam scores.
FAQs on Accountancy Class 12 Chapter 9 MCQs with Answers and Solutions
1. What are the best MCQs for Accountancy Class 12?
This page provides the best MCQs for Accountancy Class 12 Chapter 9, focusing on accounting ratios and financial statement analysis. These MCQs are designed to help you prepare for your board exams and improve your understanding of key concepts. We cover essential topics like current ratio, quick ratio, return on investment (ROI), and more, ensuring you're well-prepared for the exam.
2. What topics are covered in Accountancy Chapter 9 MCQs?
Accountancy Class 12 Chapter 9 MCQs cover key concepts in accounting ratios and financial statement analysis. Expect questions on calculating and interpreting various ratios, including:
- Liquidity Ratios (Current Ratio, Quick Ratio)
- Solvency Ratios (Debt-Equity Ratio)
- Profitability Ratios (Return on Investment - ROI)
- Activity Ratios
3. How do you solve an Accounting Ratio MCQ?
Solving accounting ratio MCQs requires a systematic approach. First, carefully read the question and identify the required ratio. Then, locate the relevant figures from the given financial statements (balance sheet and income statement). Apply the correct formula, perform the calculation, and choose the option that matches your result. Remember to understand the interpretation of the ratio to correctly choose the answer. Practice with different types of MCQs to improve your speed and accuracy.
4. Where can I download MCQs for Class 12 Accountancy?
You can download a PDF containing these MCQs for Class 12 Accountancy Chapter 9 with answers for offline use. This download provides a convenient way to practice and revise accounting ratios and financial statement analysis concepts at your own pace. The PDF includes all questions and answers presented on this page, making it ideal for last-minute revision or mobile study.
5. What are the most important formulas to know for accounting ratios?
Mastering key accounting ratio formulas is essential for acing Chapter 9 MCQs. Focus on these:
- Current Ratio: Current Assets / Current Liabilities
- Quick Ratio: (Current Assets - Inventory) / Current Liabilities
- Debt-Equity Ratio: Total Debt / Shareholders' Equity
- Return on Investment (ROI): Net Profit / Total Investment
6. How can I answer MCQs correctly in Accountancy Class 12?
Mastering Accountancy Class 12 MCQs involves understanding concepts, practicing regularly, and adopting effective strategies.
- Thorough understanding of accounting ratios and financial statement analysis is paramount.
- Practice diverse MCQs to familiarize yourself with different question types and difficulty levels.
- Review your answers carefully to avoid common errors like misinterpreting the question or using incorrect formulas.
- Time management is essential during the exam.
7. What traps should I avoid when answering MCQs on accounting ratios?
Be aware of common traps in accounting ratio MCQs.
- Carefully read the question and ensure you understand what is being asked.
- Double-check your calculations to avoid simple mathematical errors.
- Don't get confused by similar-sounding ratios. Understand the nuances and differences between them.
- Don't assume that the most complicated option is always the right one.
8. Are these MCQs based on the latest CBSE syllabus?
Yes, these MCQs for Class 12 Accountancy Chapter 9 are carefully aligned with the latest CBSE syllabus and exam pattern. They are designed to reflect the type of questions you can expect in your board exams. We ensure all questions and answers remain up-to-date with any changes to the curriculum.
9. How do I approach tough MCQs in Accountancy Class 12?
When faced with a difficult Accountancy Class 12 MCQ, break it down systematically.
- Carefully analyze the question and identify the core concepts involved.
- Eliminate any obviously incorrect options.
- Review related formulas and concepts from your textbook or notes.
- Consider the context and implications of each option before selecting your answer.
10. Where can I find more practice MCQs for Class 12 Accountancy Chapter 9?
To further enhance your preparation for Class 12 Accountancy Chapter 9, explore additional resources like practice question banks and sample papers. These will offer further opportunities to refine your understanding of accounting ratios and financial statement analysis. Look for resources specifically tailored to the CBSE curriculum. Remember, consistent practice is key to mastering these concepts for the board exams.
