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Question 107 Chapter 14 of Class 12 Part – 2 – 2024
Miscellaneous (Analytical Questions)
107. (GP Ratio/WC T/O Ratio/Debt Equity Ratio) On the basis of following information, calculate (i) Gross Profit Ratio, (ii) Working Capital Turnover Ratio, (iii) Debt Equity Ratio
Net Sales (Revenue from Operations) ₹ 30,00,000; Cost of Goods Sold (i.e. Cost of Revenue from Operations) ₹ 20,00,000; Current Assets ₹ 6,00,000; Current Liabilities ₹ 2,00,000 Paid-up Share Capital ₹ 5,00,000; Debentures ₹ 2,50,000; Loan ₹ 1,25,000.
| (i) Gross Profit Ratio | = | Gross Profit | X | 100 |
| Net Sales | ||||
| = | ₹ 10,00,000 | X | 100 | |
| ₹ 30,00,000 | ||||
| = | 33.33% |
| (ii) Working Capital Turnover Ratio | = | Sales |
| Working Capital | ||
| = | ₹ 30,00,000 | |
| ₹ 4,00,000 | ||
| = | 7.5 times |
| (iii) Debt Equity Ratio | = | Debt |
| Equity | ||
| = | ₹ 3,75,000 | |
| ₹ 5,00,000 | ||
| = | 0.75: 1 |
Working Notes :
| Gross Profit | = | Sales - Cost of goods sold |
| = | ₹ 30,00,000 - ₹ 20,00,000 | |
| = | ₹ 10,00,000 | |
| Working Capital | = | Current Assets – Current Liabilities |
| = | ₹ 6,00,000 - ₹ 2,00,000 | |
| = | ₹ 4,00,000 | |
| Debt | = | Debentures + Loan |
| = | ₹ 2,50,000 + ₹ 1,25,000 | |
| = | ₹ 3,75,000 |
Accounting & Commerce Educator
Sarbjit Singh holds a B.Com and M.Com degree and has over 12 years of teaching experience in double entry bookkeeping, financial accounting, and business studies.
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