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Question 59 Chapter 14 of Class 12 Part – 2 – 2024
Working Capital Turnover Ratio
59. (Working Capital T/O Ratio when GP on Sales is given) Calculate the working capital turnover Ratio from the following
| ₹ | |
| Working capital | 10,00,000 |
| Cost of goods sold (i.e. Cost of Revenue from Operation) | 42,00,000 |
| Gross profit on Sale 30% |
| Cost of sales | = | ₹ 42,00,000 |
| Working Capital | = | ₹ 30,000 |
| Gross profit on Sale | = | 30% |
| Calculation of Net Sales | ||
| Let assume sales | = | ₹ 100 |
| Less: Profit 30% on sale | = | ₹ 30 |
| When cost is ₹ 42,00,000 then sales | = | ₹ 100 | X | ₹42,00,000 |
| ₹ 70 | ||||
| = | ₹ 60,00,000 |
| = | Net Sales | |
| Working Capital Turnover Ratio | Working Capital | |
| Working Capital Turnover Ratio | = | ₹ 60,00,000 |
| ₹ 10,00,000 | ||
| = | 6 times |
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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