Skip to content

The process of… (Class 12 Accountancy 2026, Q27a)

questionbuddy.in/q/cbse-12-accountancy-2026-67-1-1-q27a-process-identifying-financial-strengths-weaknesses

AccountancyCBSE Class 12 · Board exam 2026, set 67/1/1 · 1 mark · MCQ

CBSE Class 12 Accountancy 2026: question 27(a)

Set in the CBSE Class 12 board exam of 2026, paper 67/1/1, section B-I, question 27(a), for 1 mark. Try it first; the hints and our step-by-step solution are below.

Q27(a) · 1 mark · MCQAnalysis of Financial Statements

The process of identifying the financial strengths and weaknesses of the firm by properly establishing relationships between the various items of Balance Sheet and the Statement of Profit and Loss is called :

  1. (A)Comparative Statement Analysis
  2. (B)Cash Flow Analysis
  3. (C)Financial Analysis
  4. (D)Common Size Analysis

Source: official question paper from cbse.gov.in (PDF). See it in the full 2026 board paper, set 67/1/1.

Hints

Open one hint at a time and try again before the next.

Hint 1

The definition describes the whole process, not one tool.

Hint 2

Three options are tools of analysis.

Step-by-step solution

Each step shows the marks it earns, as an examiner would award them. Checked by an independent re-solve from the question paper.

  1. Financial analysis means studying the relationships among items of the Balance Sheet and the Statement of Profit and Loss to judge the firm's financial strengths and weaknesses.

  2. Comparative, common size and cash flow analysis are only tools of it. Option (C).

    1 mark

Answer: (C) Financial Analysis

Where the marks are

  • Financial analysis (1 mark)

Revise the chapter

Practise this chapterBoard-style questions from Analysis of Financial Statements, one at a time, marked against the answer key and marking points.Back to the full paper2026 board paper, set 67/1/1: every question, by section.

The question is transcribed from the official paper; figures are described in words. The solution, hints and chapter tag are ours. Spotted an error? Write tosupport@questionbuddy.in.