Years': Previous
Years': Previous
Years': Previous
Examination Questions
2 Marks Questions
1. Sumo Ltd. had a current ratio of 0.8 : 1, its current as·s ets being t 2,00,000. and current
liabilities being t 2,50,000. . ·
What will be the revised current ratio of Sumo Ltd after one of its endorsed bills
. '
receivable oft 30,000 gets dishonoured? , . Sem I 2021
(a) 0.71 : 1 (b) 0.92 : 1
(c) 0.72: 1 (d) 0.82: 1
Ans (d) Current Ratio of Sumo Ltd. = O·8 = 2,00,000
. 1 2,50,000
Endorsed bill dishonoured will increase both debtor and creditor
Revised Current .Ratio= 2,00,000 + 30,000 = 2,30,000 = 0.82: 1
· 2,50,000 + 30,000 2,80,000
What will be the trade receivables turnover ratio of the company? Sem I 2021
(a) 4.75 times (b) 5.5 times
(c) 5 times (d) 6.75 times
. Credit Sales 2,00,000 ·
Ans (c) Trade Receivable Turnover Ratio = - - - -- - - - - - = - -- = 5 Times
Average Trade Receivables 40,000
-r. d R · . bl Opening Trade Receivable+ Closing Trade Receivable
Average .1ra e ece1va e =
2
= 50,000 + 30,000 = 40 000
2 ,
Credit Sales = Closing Debtors + ·Cash Received - Opening Debtors •
= 30,000 + 2, 20,000 - 50,000
= 2,00,000
294 Chapterwise ISC Solved Papers Accounts (Class XII)
7. · Assuming that the cm;rent _ratio of company is 0. 7: 1 , ·mention whether this ratio would
increas~, decrease or not change after the following transactions
(z) Payment oft 15,000 made to a creditor.
(it) Purchase of inventory'worth t 1,00,000 on 1;:redit. 2020
Ans (z) Decrease 'Since numerator [current assets (cash)] and denominator [current liabilities (creditor)]
reduces by same amount, the ratio decreases.
(ii) Increase Since numer~tor [current assets (inventories)] and denominator [current liabilities
(creditor)] increases by same amount, the ratio increases.
Ratio Analysis
295
2020
Ans Profit before Tax
= t 15,00,000
(-) Tax Rate @ 30%
= t (4,50,000)
~ 10,50,000
(- ) Preference Dividend = ~ (60,000)
~ 9,90,000
Outstanding Equity Shares = 3, 00, 000
Earning per Share = 9,9 o, OOO = 3.3
3,00,000
10. · The _quick ratio of a company is 0.8 : 1. State whether the quick ratio will improve, decline
or will not change in the following cases · 2018
(z) Cash collected from debtors t 50,000.
(ii) Creditors oft 20,000 paid-off.
296 Chapte rwise ISC Solved Papers Accoun ts (Class XII)
Will be
Ans (z) Cash collec~ed from debtors will not change the total of quick assets because one quick asset
replaced by another. Therefo re, the quick ratio will not change.
the same amount.
(iz) Paymen t to creditor s will reduce the quick assets as_well as current liabilitie s by
Therefo re, the quick ratio will decline.
11. The current ratio of a compan y is 2_: 1. State whethe r .the current ratio will improv e,
2017
decline or will not change in the followi ng cases
( z) Bill receiva ble of~ 2,000 endorse d to a credito r is dishono ured.
(ii) ~ 8,000 cash collecte d from debtors of ~8,500 in full and final settlem ent.
as current
Ans ( t) Bill receivab le endorse d to a creditor is dishono ured. It will reduce the current assets as well
liabilitie s by the same amount. Therefo re, the current ratio will decline.
current asset will
(ii) Cash collecte d from debtors will not change the total of current assets because one
current
be replaced by another. But discount allo~ed reduces the account receivab le, thus reducing
· assets. Therefo re, tlie current ratio will decline.
12. The current ratio of a compan y is 2 : 1. State whethe r the followi ng will increas e, reduce
2015
or not change the ratio
( z) Bills payable ~ 5,000 discharg ed. (iz) Purchas e of invento ry f 20,000 on credit.
the same amount.
Ans ( z) Bills payable discharg ed will reduce current assets as well as current liabilitie s by
Therefo re, current ratio will increase.
( it) Purchas e of inventor y on credit will increase current assets as well as current
liabilities by the same
amount. Therefo re, current ratio will reduce. ·
2015
13. Give the formula e for calculat ing
( ZJ Earning per share. ( itJ Trade payable s ·turnove r ratio.
.) E . p Sh Net Profit available to Equity Shareho lders
Ans (z am1ng er are =
Number of Equity Shares
Net Credit Purchase s-
( ii) Trade Payable s Turnove r Ratio = - - - - -- ·P --
Average Trade ayables
14. Assum ing that the debt-eq uity ratio of a compan y is 2 : 1, state whethe r this ratio would
2012
increas e, decreas e or not change in the following cases
(i) Issue of new shares for cash · _
(ii) Repaym ent of a long-te rm bank lban
decrease.
Ans (i) Issue of new shares for cash will increase the equity. Therefo re, debt-equ ity ratio will
( ii) Repaym ent of a long-ter m bank loan will reduce deb~ as well as shareho lders'
fund, i.e. current assets
by the same amount. Therefo re, debt-equ ity ratio will decrease .
2011
15. State two differen ce betwee n .current ratio and quick ratio.
Ans Differen ce between current ratio and quick ratio
Basic Current ratio Quick ratio
Meaning This ratio establishes relationship between This ratio establishes relationship between liquid
current assets and current liabilities and is assets and current liabilities and is used to
used to assess the short-term financial measure the firm 's ability to pay the claims of
position of the business concern. credi,tors immediately.
Ideal ratio Current ratio of 2: 1is considered to be This ratio is a better indicator of liquidity and 1 : 1
satisfactory.' is considered to be satisfactory. -
J
Ratio Analysis 297
16. How is 'cost of goods sold' i.e., cost of revenue from operations calculated? 2009
Ans Cost of Revenue from Operations = Opening Inventory + Net Purchases + D irect Expenses
- Closing Inventory
or
= Revenue from Operations (Net sales) - Gross Profit
17. What is gross profit ratio and net profit ratio? 2009
Ans Gross Profit Ratio Gross profit ratio shows the relationship between gross profit to net sales (revenue
from operations).
Gross Profit Ratio = Gross Profit x 100
Revenue from Operations (Net sales)
Net Profit Ratio Net profit ratio shows the relationship between net profit and net sales (revenue
from operations). Net profit ratio is an indicator of overall operational efficiency 6f the business.
Net Profit Ratio= Net Profit x 100
Revenue from Operations (Net sales)
18. Name any two balance sheet ratios. 2008
Ans The two balance sheet ratios are
(i) Current ratio (ii) Quick ratio·
19. When calculating the acid test ratio, name two items that are excluded from current assets.
2008
Ans Inventories and pre pai~ expenses are the items, which are excluded.
20. What is quick ratio? State its significance. 2005
Ans This ratio establishes relationship between liquid assets and current liabilities and is used to measure
the firm' s ability to pay the claims of creditors immediately. This ratio is a better indicator of liquidity
. and.a quick ratio of 1 : 1 is considered to be satisfactory.
Liqw·d R atio · Jn, · k Ra.tio/Ac1'd 'T'1.est R atio
'<-mc . =-
Liquid Assets or~
Quick Assets*
~- - -- ~- - --
. Current Liabilities
*Liquid/ Quick Assets= All Current Assets - Inventories (excluding loose tools and spare parts)
- Prepaid Expenses
6 Marks Questions
21. From the following information calculate the following ratios (upto two decimal places)
(z) Debt to Total Assets Ratio .(ii) Proprietary Ratio
(iii) Inventory Turnover Ratio
Particulars Amt (~)
Property, Plant and Equipment and Intangible Assets 14,00,000
~urrerit Assets (including inventory of~ 2,00,000) 10,00,000
St:iareholders' Funds 14,40,000
Non-current Liabilities (10% long-term Bank Loan) 8,00,000
Current Liabilities 5,00,000
Revenue from Operations 15,00,000
Gross Profit -6,00,000
2020
298 Chapte rwise ISC solved Papers Accoun ts (Class XII)
22. From the following information calculate (upto two decimal places)
(i) Gross profit ratio ·
(ii) Inventory turnover ratio
(iii) Net profit ratio ·
Particulars Amt m
2
· Gross Profit = Revenue from Operations (Cash_+Credit) - Cost of Revenue from Operations
= (70,000 + 2,80,000) - 2,80,000
= 3,50,000- 2,80,000 = ~ 70,000
Notes to Accounts
1. Change in Inventories
Opening Inventory 8,000
· Closing Inventory 12,000
(4,000)
2. Other Expenses
Carriage Outward 4,000
Rent 2,000
6,000
Additional information
Total current liabilities as on 31st March, 2018 t 50,000
Current assets (other than inventory) as on 31st March, 2018 t 70,000 2019
Ans ~ N p fi R . Net Profit after Tax
(i1 et ro 1t aho = - - - - - - - -- x 100
Revenue from Operations
= 74000 x l00
3,00,000
=24%
. • Operating Profit
(ii) Operating Profit Ratio = - - - = - - - - - - = ' - - - - - x 100
Revenue from Operations
= 1,20,000 xl0O
3,00,000
=40%
Operating Profit = Revenue from Operations + Other Income - Purchase - Change in Inventories
- Employee Benefit Expenses (salary) - Depreciation - Other Expenses
= 3,00,000 + 40,000 - 1,80,000 - (-4,000) - 10,000 - 28,000 - 6,000
= t 1,20,000
Current Assets
(iii) Current Ratio = . b"l" .
Current Lia 1 1ties
70,000 + 14000
= 50,000
= 1.64 : 1
Quick Assets ·
(iv) Quick Ratio = - ~ - - - -
Current Liabilities
= 70,000 =1.4 : l
50,000
Ratio Analysis
301
24. (i) Calculate the Net Profit Ratio (upto two decimal places) from the following information
Particulars ·1 Amt (~
Gross Profit 80,000
Salary and Rent 30,000
Interest on Debentures 5,000
Gain on Sale of Furniture 2,000
Revenue from Operations 4,00,000
(ii) From the following information calculate the following ratio (upto two decimal places)
(a) Earning pe~ share (b) Price earning ratio
(c) Return on investments (d) Working capital turnover ratio
Particulars Amt(~
Net Profit after Interest-and Tax 2,40,000
Tax 1,60,000
Net Property, Plant and Equipment and lnta.ngible Assets 10,00,000_
Non-current Investments (Non-trade) 1,00,000
Equity Share Capital (face value~ 10 per share) 5,00,000
15% Preference Share Capital 1,00,000
Reserves and Surplus (including surplus of the year undertonsideration) 2,00,000
10% Debentures 4,00,000
Revenue from Operations 10,00,000
Working Capital 1,00,000
2018
Note The market value of an equity share is~ 40.
Ans (i) Net Profit after Tax = Gross Profit - Salary and Rent - Interest on Debentures
+ Gain on Sale of Furniture
=80,000 - 30,000 - 5,000 + 2,000 =~ 47,000
. =
Net Profit Ratio Net Profit after Tax. x 100-
- 47,000 x 100 = 11 .75%
Revenue from Operations 4, 00, 000
= 2,40,000-15,000 = ~ 4.50
50,000 ..
. . . Market Value of an Equity Share _ 40 =
. (b) Price_Earnmg Ratio = Earning.Per Share - 4.5 8 .88
Net Profit before Interest and Tax x l00 = 4,40,000 x 100 = 36.67%
(c) Return on Investment= Capital Employed 12,00,000
. . . _ Revenue from Operations = 10, 00, 000 = times
(d) Working Capital Turnover Ratio - Working Capital 1, 00, 000 10
r
Working Note
Amtm
Particulars
2.40,000
1. Net Profit after Interest and Tax
1,60,000
(+)Tax
4,00,000
40,000
(+) Interest
4.40,000
Net Profit before Interest and Tax
2. Capital Employed
5,00,000
Equity Share Capital
2,00,000 ·
(+) Reserve and Surplus
7,00,000
(+) Preference Share Capital
l,00,000
Shareholders' Fund
8,00,000
(+) Long-term Borrowings (10% Debentures) 4,00,000
12,00,000
25. From the information given below, calculate (upto two dec_imal places)
(i) Operating ratio (ii) Quick ratio
(iii) Debt to equity ratio (iv) Proprietary ratio
(v) Working tapital turnover ratio
Particulars Amtm
Net Revenue from Operations 12,00,000
Cost of Revenue from Operation 9,00,000
Operating Expenses 15,000
Inventory 20,000
Other Current Assets 2,00,000
Current Liabilities 75,000
Paid-up Share·Capital 4,00,000
Statement of Profit and Loss (Dr-) 47,500
Total Debt 2,50,000
2017
·) . . Cost of Revenue from Operations + Operating Expenses
Ans (i 0 perating Ratio = · x 100
·Net Revenue from Operations ,
=9,00,000 + 15,000 X lO0 = 76 _250
12 00 000
, ' Vo
.
Liquid Assets 2 00 000
(ii) Quick Ratio -----"--- - = ' ' = 2.67 · 1
Current Liabilities 75,000 ·
Note Other current assets are treated as liquid assets.
·· ·) D b E · Ra .
(rn e t to qwty tio =
Debt
· =-2,50,000
- - = O 71 · 1
Shareholders' Funds 3,52,500 · ·
Working Note
Shareholders' Fund= Paid- up Sha.re Capital - Statement of Profit and Loss (Dr)
= 4,00,000 - 47,500 =t 3,52,500
p_atio Analysis
303
26. (i) Calculate liquid ratio from the following (upto two decimal places)
Current assets ~ 1,26,000
Inventories ~ 2,000
Current ratio 3 :2
(ii) From the following statement of profit and loss of Dixon Ltd for the year 2014-15,
calculate (upto two decimal places) .
·(a) Trade receivables turnover ratio (b) Inventory turnover ratio
(c) Net profit ratio (d). Operating profit ratio
Statement of Profit and Loss
for the year ending 31st March, 20 i 5
Particulars Note No. Amt(f)
Revenue from Dperations 2,00,000
Other Income (Rent received) 10,000
Total Revenue 2,10,000
Expenses .
Purchases 55,000
Change in Inventories 1 3,000
Employee Benefit Expenses 2 5,000
Depreciation 2,000
Other Expenses 3 5,000
Total Expenses 70,000
Profit before Tax 1.40,000
(-l Tax (56,000)
Profit after Tax 84,000
304 Chapter wise ISC Solved Papers Account s (Class XII) .
Notes to Accounts
31st MarchI
Particulars 201s m
'
1. Change in Inventories
6,000
Opening Inventory
(3,000)
Closing Inventory
3,000
3. Other Expenses
. 2,000
Carriage Inward
3,000
. Carriage Outward
5,000
Additional information
Debtors (as on 31st March, 2015) t 7,000
Bills receivable (as on 31st March, 2015) t 5,000
Cash revenue from operations t 50,000 2016
. = -Liquid
L' .d R atio Assets 1,24,000 = _
Ans (t.) 1qm - - ' - - - - - = - - - 1 48
Current Liabilities 84,000
Working Notes
. CurrentA ssets 3 1,26,000
1. Curren tRa t1 0 = - - - -- - =- =-'---'----
CL
Current Liabilities 2
CL=~ 2,52,000
3
Thus, Current Liabilitie s= f 84,000
2 . Liquid Assets= Current Assets - Inventori es = 1!26,000 - 2,000 = f 1,24,000
2. Opening rec·eivables is not given therefore , closing receivable is taken as average trade
receivables
Average Trade Receivables= Closing Debtors+ Closing Bills Receivable
=7,000 + 5,oob =f 12,000
R . Cost of Revenue from Operation s 62,000 .
,n
(b) I nventory .1umover atio =- -- - -- - - ~- - - =- . times
- = 4133
_ Average Inventory 1,500
Working Notes
1. Cost of Revenue from Operatio ns= Purchase s+ Changes in Inventori es
· + Direct Expenses (Wages + Carriage inward)
~ 55,000 + 3,000 + (2,000 + 2,000) = ~ 62,000
r
~atio Analysis 305
Working Notes .
1. Shareholders' Funds= Equity Share Capital + Preference Share Capital+ General Reserve+ Profit
= 2,00,000 + 60 ,000 + 1,20,000 + 90,000 =f4,70,000
2. Long-term Debts = Loan =f 5,00,000
,
\
. tary Rati
(c) Propne Shareholders' Funds 4, 70,000 _ 0 75 .1
o=----- = . - · ·
Total Assets 6, 25, 000
Worlcing Note '
Total Assets= Fixed Assets + Current Assets= 5,05,000 + 1,20,000 =~ 6, 2 5,000
28. (i) The following information is available from the books of Greg Good~ Ltd
Particulars Amt (~)
Working Notes
1. Cost of Revenue from Operations = Revenue from Operations - Gross Profit
Gross Profit= 20 x 8,00,000 = ~ 1,60,000
100
Cost of Revenue from Operations = 8,00,000 - 1,60,000 = ~ 6,40,ooo
Opening Inventory+ Closing Inventory 40,ooo + so,ooo t45,ooo
2 . Average Inventory=....:...E....:..:..:.::..:..::.!e~_.:_:_:.:..:..:..:.L---=----""---~ = .
2 2
.
=40,000 +4,000 + 60,000 = ·t 1,04,000
.
(b) Quick Ratio= Quick Assets = 80,000 = _ 0_77 : 1 .
Current Liabilities 1, 04, 000
Working Note
Quick Assets = Debtors + Bill Receivable + Cash
=40,000 + 10,000 + 30,000 = t 80,000
29. From the following information, calculate (upto two decimal places)
(i) Liquid ratio (ii) Current ratio
(iii) Proprietary ratio (iv) Working capital turnover ratio
.(v) Gross profit ratio (vi) Operating ratio
(vii) Net profit ratio
Particulars Amt(~)
2012
Ratio Analysis 309
(iv) Working Capital Turnover Ratio= Revenue from Operations (Net sales)
Working Capital
Working Note
Gross Profit= Revenue from Operations (Net sales) - Cost of Goods Sold (Cost of revenue from
operations)
= 7,90,000 - 6,00,000 = ~ 1,90,000
Working Note
Operating Cost= Cost of Revenue from Operations + Operating Expenses
= 6,00,000 + 50,000 = ~ 6,50,000
Working Note
Net Profit= Gross Profit - Operating Expenses
= 1,90,000 - 50 ,000 =~ 1,40,000
310 Chapter wise ISC Solved Papers Account s (Class XII)
nd
30. The following figure have been extracted from the books of Arvind a Compan y Ltd
Amt(~)
Particulars
12.00,000
Net Sales (Revenue _from operations)
5,00,000
Net Purchases
65,000
Administrative Expenses
35,000
Selling and Distribution Expenses
20% on sales
Gross Profit
10,00,000
Net Profit after Tax
40,00,000
Total Assets
10,00,000
Equity Share Capital oft 10 each
3,00,000
10% Preference Share Capital fort 10 each
2,00,000
Reserves and Surplus
8,00,000
8% Debentures
1,20,000
Opening Debtors
80,000
Closing Debtors
60,000
Opening Bills Receivable
40,000.
Closing Bills Receivable
1,30,000
Opening Creditors
70,000
Closing Creditors
50,000
Closing Bills Payable
1,10,000
Opening Bills Payable
40,00,000
(i') ~
tal Assets to Deb ts Ra.tio = - Total
- -Assets
--- =- - - - = 5 :1
Ans 1.0
Long-term Debts 8,00,000
..) D b E . R . 8,00,000
Debt / Long -term Debts - = - 0
(u e t qt11ty atio = - - - - ~ - - -- - - = 53 · I
Equity/Shareholder s' Funds 15,00,000 · ·
Working Note
Sharehol ders' Funds= Equity Share Capital+ Preferenc e Share Capital+ Reserve and Surplus
=10,00,000 + 3,00,000 + 2,00,000 =t 15,00,000
Operating Cost
--
(iii) Operatin g Ratio = - - - -~ - ~ - - - -sales)
Revenue from Operations (Net
Cost of Revenue from Operations + Operating Expenses
or = . x l00
Revenue from Operations (Net sales)
- = 10,60,000 x lO0 =88. 33%
12,00,000
Ratio Analysis 311
Working Notes
1. Cost of Revenue from opera t"ions= Net Revenue from Operations
·
-Gross Pro_fit
= 12,00,000 -(20% of 12,001000)
. = 12,00,000-2,40,000 =f 9,60,000
2
· Operating Cost =Cost of Revenue from Operations +Operating Expenses
·=9,60,000 +(65,000 +35,000) =' 10,60,00~
(iv) Operating Profit Ratio= Operating Profit xlOO ~ 1,40,000 xlOO = 11.670/o
Revenue from Operations (Net Sales) · 12,d0,000
Working Note
(vi) Debtors_Turnover Ratio= Revenue from Operations (Net credit sales)= 12,00,000 =8 times
Average Trade Receivable 1,50,000
Working Note
Average Trade Receivables
= Opening Debtors+ ClosiI).g Debtors+ Opening Bills Receivable+ Closing Bills Rece·ivable
2
1, 20,000 + 60,000 + 80,000 + 40,000 ., O
= - - - ' - -- ----'------'--------'----'--- = '\ 1, 5 ,ooo
2 !
(vii··) C red't
1 11urnover
Rati'o = -Net
-- Credit
- -Purchases
- - - - = _.5,00,000
....;__ _ = 2. 77 : 1
Average Trade Payables 1,80,000
Working Note
Average Trade Payables= Opening Creditors+ Opening Bills Payable+ Closing Creditors+ Closing Bills Payable
. . 2 -
= 1,30,000 + 1,10,000 + 70,000 + 50,000 =' 1,80,000
2
.2,'l0,000 g .
= - - - = times
30,000
Working Note
Particulars
1. Changes in Inventories Amt (f)
Opening Inventory
(-) Closing Inventory 50,000
Administrative Expenses
Selling Expenses 20,000
30,000
Finance Expenses (Interest on long-term loan)
Direct Expenses 25,000
50,000
1,25,000
Balance Sheet
as at 31st March 2012
'
Particulars
Note No. Amt (f)
I. EQUITY AND LIABILITIES
1. Shareholders' Funds
(a) Share Capital
(bl Reserves and Surplus 1 7,00,000
2. Non-current Liabilities 2 1,11 ,000
Long-term Borrowings
1,50,000
3. Current Liabilities
Trade Payables
3 24,000
Total
9,85,000
II. ASSETS
1. Non-current Assets
Property, Plant and Equipment
7,20,000
2. Current As·sets
(a) Inventory
80,000
(b) Trade Receivables
1,20,000
(c) Cash and Cash Equivalents
4 60,000
(d) Other Current Assets
5 f--
5,000
Total
9,85,000
-
Notes to Accounts
- - - - -- -- - - - - -- - -- - - - - - - - - - - - -
Particulars
Amt m
1. Share Capital
Equity Share Capital
4,000 Equity Shares of~ 100 each
4,00,000
Preference Share Capital
3,000, 5% Preference Shares of~ 100 each
3,00,000
7,00,000
Chap terw ise ISC Solved Papers Acco unts (Class XII)
314
Amt(?)
-
Particu lars -- -
2. Reserve and Surplus 5,000
Reserves 1,06,000
Statement of Profit and Loss 1,11,000
-
3. Trade Payables 20,000
Creditors 4,000
Bills Payable 24,000
---=
.) A .d ~ Ra . _ Liquid _ 0 -_ 7.5 .• l
1,80,00__
_ _ _- _;__.;__
Assets
A ns (i c1 .test ho - _ __.___ Liabili ties 24,000
Liquid
Working Notes
1.Liquid Assets =Trade Receivables + Cash + .Bank
=1,20, 000 + 15,000 + 45,000 =t 1,80,0 00
2. Liquid Liabilities =Cred itors+ Bills Payabl e= 20,000 +4,000 = t 24,000
Profit 2,80,00
-- 0 x lOO = 56011,o
..) G ross p rofi1t R atio
u
. =- - - - - Gross
- - -- - - - - x 100 =-
( Revenue from Operat ions (Net sales) 5, 00, 000
Working Notes
tions (WN2)
1.Gross Profit= Revenue from Opera tions - Cost of Reven ue from Opera
. = 5,00,0 00 - 2,20,0 00 ~ 2,80,0 00
Direct Expen ses
2. Cost of Revenue from Opera tions= Openi ng Invent ory+ Purch ases+
- Closing Inventory
= 50,000 + 2,00,0 00 + 50,000 - 80,000 = ~ 2,20,0 00
.turnover Rabo
...) S toek rr.
m _of
Cost
. =_ __ ue
_Reven _ _Operat
_from _._____ions _ _of goods sold)
_...:(Cost _.!.. ___.!,!.....__ _
2 '
2
. =_
. g Ratio Cost of Reven ue from_Operat ions + Opera
__.___ ___ ting Expen ses
. ! . . . _ _ ~ _ L _ _ _ x 100
.
w 1 peratm ___ ___
( 10
Revenue from Operat ions (Net sales)
= 2,20,000 + (20,000 + 30,000) X _ 0
5 00 000 lOO - 54 1/o
' '
. R . Debt / Long~term Debts 1, 50,000
. D b
( v11 e t
E
qmty atio - - - =--- - - - =-8,11,-000 =0.18 ·. I
=-Equity I Shareholders' Funds
Ratio Analysis 315
Working Note
Shareholders' Funds= Equity Share Capital + Preference Share Capital + Reserves
+ Statement of Profit and Loss
=3,00,000 + 4,00,000 + 5,000 + 1,06,000 =" 8,11,000
33. Statement of Profit and Loss
for the year ending 31st March
Particulars Note No. Amt(~
-
I. Revenue from Operations 1:00.100
II. Other Income 1 1,200
Ill. Total Revenue 1,01,300
IV. Expenses
Purchase of Stock-in-trade 63,050
Changes in Inventories 2 (4,350)
Employee Benefit Expenses 3 1,000
Other Expenses 4 24,800
Total Expenses . 84,500
V. Profit before tax (Ill-IV) 16,800
.
f:lotes to Accounts
Particulars Amt(~)
1. Other Income
No_n-operating Income 1 200
2. Changes in Inventories
Opening Inventory 15,250
(-) Closing Inventory (19,600) (4,350)
Balance Sheet
Particulars Note No. Amt(~)
Notes to Accounts
Particulars Amtm
1. Reserves and Surplus
Reserves 1,200
Statement of Profit and Loss 16,800
18,000
Working Note
Average Inventory= Opening Inventory+ Closing Inventory
2
_ 15,250 + 19,600 •
- =,17,425
2
(iv) Proprietary Ratio = Shareholders' Funds = 88.,000 = _
0 96 times
Total Assets 91,700
Working Notes ·
1. Shareholders> Funds= Share Capital+ Reserves + Statement of Profit and Loss
=70,000 +· 1,200 + 16,800 = ~ 88,000
2. Total Assets= Non-current Assets + Current Assets
=60,100 + (19,600 + 9,000 + 3,000) =t 91,700
(v) Current Ratio _- Current Assets = 31,600 = 8 _54 : 1
Current Liabilities 3,700
Working Note
Current Asse.ts =Inventory+ Debtors +Bank= 19,600 + 9,000 + 3,000 = t 31,600
.) n, . k Ra. · _ Quick Assets _ 12,000 _ 3 24 . 1
(vi x,.UlC tio - --=------- - - - - . .
Current Liabilities 3,700
Working Note
Quick Assets= Debtors +Bank= 9,000 + 3,000 = ~ 12,000