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Concepts & Modes of Analysis Class 10 Questions and Answers contains important questions taken from CBSE Board Papers. The questions cover key concepts and modes of analysis and are provided with simple, clear, and exam-oriented answers. Practising these previous board questions can help Class 10 students understand the question pattern, revise important concepts, and prepare effectively for the examination.
Concepts & Modes of Analysis Class 10 Questions and Answers
Q. If interest rate is compounded quarterly, then the number of conversion periods per year would be _________. (CBSE 2025-26)
(A) two
(B) three
(C) four
(D) six
Answer: (C) four
Q. Assertion (A) : All fixed assets, except for land, have a defined lifespan.
Reason (R) : Each year, it is assumed that the value of an asset decreases due to usage. The decrease in value is referred to as ‘Depreciation’. (CBSE 2025-26)
(A) Both (A) and (R) are true and (R) is the correct explanation of (A).
(B) Both (A) and (R) are true, but (R) is not the correct explanation of (A).
(C) (A) is true, but (R) is false.
(D) (A) is false, but (R) is true.
Answer: (A) Both (A) and (R) are true and (R) is the correct explanation of (A).
Q. When you invest money, you earn interest on your capital. The next year you earn interest on both your original capital and interest from the first year. In the third year, you earn interest on your capital and the interest on the first two years’ interest… and so on. This concept is known as __________. (CBSE 2024-25)
(A) The concept of Discounting
(B) The concept of Compounding
(C) The concept of Simple Interest
(D) The concept of Profit
Answer: (B) The concept of Compounding
Q. ___________ is the sum of present values of all the cash inflows of this annuity. (CBSE 2024-25)
(A) Present value of a single cash flow
(B) Future value of an annuity
(C) The present value of annuity
(D) The future value of a net cash flow
Answer: (C) The present value of annuity
Q. of a company is a record showing source of funds and their application of creating/building assets. (CBSE 2023-24)
(a) Balance Sheet
(b) Income Statement
(c) Profit and Loss Account
(d) Share Capital
Answer: (a) Balance Sheet
Q. Explain the following terms : (CBSE 2023-24)
(a) Net worth
Answer: Net Worth refers to the shareholders’ funds in a company. It consists of Share Capital and Reserves & Surplus.
(b) Time value of Money
Answer: Time Value of Money means that money available today is worth more than the same amount received in the future because it can be invested and earn returns.
(c) Corporate Analysis
Answer: Corporate Analysis is the study of a company’s performance, management, growth plans, financial position and future prospects to evaluate its strength.
(d) Loan Fund
Answer: Loan Fund refers to money borrowed by a company from outside sources such as banks, financial institutions or the public. It includes secured loans and unsecured loans.
Q. Financial performance of the company and certain key financial parameters like Earning Per Share (EPS), P/E ratio, current size of equity etc. for arriving at the estimated future price. This is known as ________. (CBSE 2022-23)
(a) Industry Analysis
(b) Corporate Analysis
(c) Financial Analysis
(d) Firm Analysis
Answer: (c) Financial Analysis
Q. Write the formula of Interest Coverage Ratio. (CBSE COMP 2024-25)
Answer: Interest Coverage Ration = EBIT (Earnings Before Interest and Taxes) / Interest
Q. What items are included in the liability section of a company’s balance sheet ? (CBSE 2025-26)
Answer: The liability section of a company’s Balance Sheet includes:
- Share Capital
- Reserves and Surplus
- Secured Loans
- Unsecured Loans
- Current Liabilities and Provisions
Q. List the features of annual report. (CBSE COMP 2024-25)
Answer: The following features of an Annual Report should be read carefully:
- Director’s Report and Chairman’s Statement
- Auditor’s Report
- Profit and Loss Account
- Balance Sheet
- Notes to Accounts attached to the Balance Sheet
Q. Explain corporate analysis and financial analysis. (CBSE COMP 2024-25)
Answer:
- Corporate Analysis: Corporate Analysis means studying a company’s current operations, managerial capabilities, growth plans, past performance and future prospects.
- Financial Analysis: Financial Analysis means examining the financial performance of a company through parameters such as EPS, P/E Ratio and current size of equity to estimate its future value.
Q. Interest is an amount charged to the borrower for the privilege of using _________.(CBSE 2023-24)
Answer: the lender’s money
Q. Calculate the value of deposit (Compound interest) of = 5000 made today, 2 years hence if interest rate is 8%. (CBSE 2023-24)
Answer:
Formula:
- C = P(1 + i)n
Where,
- P = ₹5000
- i = 8/100 = 0.08
- n = 2 years
C – 5000(1.08)2
C = 5000(1.1664)
C = ₹5832
Value of Deposit after 2 years = ₹5,832
Q. What is meant by ‘Real rate of return ? (CBSE 2022-23)
Answer: Real Rate of Return is the return earned on an investment after adjusting for inflation. It shows the actual increase in the value of an investment after the effect of rising prices.
Q. “National Hydroelectric Power Company (NHPC) Ltd., National Thermal Power Company (NTPC) Ltd., Tata Power Company (TPC) Lid. etc. belong to the Power Sector/Industry of India.” What does Industry Analysis mean ? (CBSE 2022-23)
Answer: Industry Analysis means studying the performance and future prospects of an industry or sector. It includes factors such as government policies, market demand and business environment affecting the industry.
Q. What do you mean by ‘Time value of Money ? (CBSE 2021-22)
Answer: Time Value of Money means that a rupee received today is worth more than the same rupee received in the future because it can be invested and earn returns.
Q. What is meant by conversion period ? (CBSE 2021-22)
Answer: Conversion Period refers to how often interest is calculated or compounded during a year. For example, if interest is compounded quarterly, there are four conversion periods in a year.
Q. Companies publish annual reports and send abridged versions to shareholders free of cost. An annual report of a company is the best source of information about the financial health of a company. In the light of this statement, describe an annual report and its features. (CBSE 2021-22)
Answer:
Annual Report: An Annual Report is a formal financial statement issued every year by a company. It shows the company’s assets, liabilities, revenues, expenses and earnings. It is the best source of information about the financial health of a company.
Features of Annual Report:
- Director’s Report and Chairman’s Statement explaining current and future performance.
- Auditor’s Report containing the auditor’s observations.
- Profit and Loss Account showing the company’s income and expenses.
- Balance Sheet showing the financial position of the company.
- Notes to Accounts providing additional financial information.
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