Question 142 Chapter 4 of +2-B - T.S. Grewal 12 Class

Question 142 Chapter 4 of +2-B

Miscellaneous

142. From the information given below, calculate any three of the following ratio:
(i)Gross Profit Ratio;
(ii) Working Capital Turnover Ratio:
(iii)Debt to Equity Ratio; and
(iv) Proprietary Ratio.

	Rs		Rs
Revenue from Operations Net Sales	5,00,000	Current Liabilities	1,40,000
Cost of Revenue from Operations (Cost of Goods Sold)	3,00,000	Paid-up Share Capital	2,50,000
Current Assets	2,00,000	13% Debentures	1,00,000

 

The solution of Question 142 Chapter 4 of +2-B: -

I

Net Sales	=	Rs 5,00,000
Cost of Goods Sold	=	Rs 35,000
Gross Profit	=	Net Sales − Cost of Goods Sold
	=	Rs 5,00,000 - Rs 3,00,000
	=	Rs 2,00,000

Gross Profit Ratio	=	Gross Profit	X	100
		Net Sales

Gross Profit Ratio	=	Rs 2,00,000	X	100
		Rs 5,00,000
	=	40%

 

II

Net Sales	=	Rs 1,20,000
Operating Cost	=	Cost of Goods Sold + Operating Expenses
	=	Rs 60,000 + Rs 40,000
	=	Rs 1,00,000

Operating Ratio	=	Operating Cost	X	100
		Net Sales

Operating Ratio	=	Rs. 1,00,000	X	100
		Rs 1,20,000
	=	83.33%

 

III

Long-term Debts	=	Rs 1,00,000
Equity	=	Rs 2,50,000

Debt - Equity Ratio	=	Long-term Debts
		Equity

Debt - Equity Ratio	=	Rs. 1,00,000
		Rs 2,50,000
	=	0.4 : 1

IV

Total Assets	=	Total Liabilities
Operating Cost	=	Current Liabilities + Paid-up Share Capital + 13% Debentures
	=	Rs 1,40,000 + Rs 2,50,000 + Rs 1,00,000
	=	Rs 4,90,000

Proprietary Ratio	=	Shareholders’ Fund
		Total Assets

Proprietary Ratio	=	Rs. 2,50,000
		Rs 4,90,000
	=	0.51 : 1

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Also, Check out the solved question of previous Chapters: -

T.S. Grewal’s Double Entry Book Keeping +2 (Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms)

• Chapter No. 1 - Financial Statement of Not-For-Profit Organisations
• Chapter No. 2 - Accounting for Partnership Firms - Fundamentals
• Chapter No. 3 - Goodwill: Nature and Valuation
• Chapter No. 4 - Change in Profit-Sharing Ratio Among the Existing Partners
• Chapter No. 5 - Admission of a Partner
• Chapter No. 6 - Retirement/Death of a Partner
• Chapter No. 7 - Dissolution of a Partnership Firm

T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)

• Chapter No. 8 - Company Accounts -  Accounting for Share Capital
• Chapter No. 9 - Company Accounts - Issue of Debentures
• Chapter No. 10 - Redemption of Debentures

T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)

• Chapter No. 1 - Financial Statements of a Company
• Chapter No. 2 - Financial Statement Analysis 
• Chapter No. 3 - Tools of Financial Statement Analysis - Comparative Statements and Common- Size Statements
• Chapter No. 4 - Accounting Ratios
• Chapter No. 5 - Cash Flow Statement

Check out T.S. Grewal +2 Book 2020@ Official Website of Sultan Chand Publication