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Class 12 Accounting Ratios worksheet

CBSE Accountancy. Liquidity, solvency, activity and profitability ratios: current, quick, debt-equity, proprietary, interest coverage, turnover ratios, gross and net profit, operating ratio and return on investment. Every sheet has 20 questions in three sections and an answer key, and the numbers change every time.

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Sample questions

Real questions from this chapter, as the app sets them. Tap Answer to see the answer and working.

Section A · multiple choice

  1. 1.

    Current ratio is a:

    1. activity ratio
    2. profitability ratio
    3. solvency ratio
    4. liquidity ratio
    Answer

    (d) liquidity ratio

  2. 2.

    The proprietary ratio is a:

    1. profitability ratio
    2. activity (turnover) ratio
    3. solvency ratio
    4. liquidity ratio
    Answer

    (c) solvency ratio

  3. 3.

    The net profit ratio is calculated as:

    1. revenue from operations ÷ working capital
    2. profit before interest and tax ÷ interest on long-term debt
    3. quick assets ÷ current liabilities
    4. profit after tax ÷ revenue from operations × 100
    Answer

    (d) profit after tax ÷ revenue from operations × 100

Section B · short answer

  1. 4.

    What is an accounting ratio?

    Answer

    A mathematical relationship between two accounting figures, shown as a pure ratio, a percentage, times or a fraction.

  2. 5.

    Write the formula for (a) the net profit ratio (b) the proprietary ratio

    Answer

    (a) profit after tax ÷ revenue from operations × 100 (b) shareholders’ funds ÷ total assets

Section C · long answer

  1. 6.

    Explain the classification of accounting ratios.

    Answer

    Liquidity (current, quick), solvency (debt-equity, total assets to debt, proprietary, interest coverage), activity (inventory, receivables, payables, working capital turnover) and profitability (gross profit, operating, net profit, return on investment).

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