Question 102 Chapter 4 of +2-B – T.S. Grewal 12 Class

Question 102 Chapter 4 of +2-B

Question 102 Chapter 4 of +2-B

Working Capital Turnover

102. A company earns Gross Profit of 25% on cost. For the year ended 31st
March, 2017 its Gross Profit was Rs. 5,00,000; Equity Share Capital of the
company was Rs. 10,00,000; Reserves and Surplus Rs. 2,00,000; Long
term Loan 3,00,000 and Non-current Assets were 10,00,000.
Compute the ‘Working Capital Turnover Ratio’ of the company.

The solution of Question 102 Chapter 4 of +2-B: –

Gross Profit = 25% on Cost
Cost of Goods sold = 100
Gross Profit = 25
Revenue from Operations = 125
Revenue from Operations = Rs.5,00,000 X 125
25
  = Rs.25,00,000    

 

Capital Employed = Shareholder’s Funds + Non- Current Liabilities
  = Rs. 10,00,000 + Rs. 2,00,000 + Rs. 3,00,000
  = Rs. 15,00,000
Working Capital = Capital Employed – Non- current Assets
  = Rs. 15,00,000 – Rs. 10,00,000
  = Rs. 5,00,000

 

Working Capital Turnover Ratio Net Sales
Working Capital
  Rs. 25,00,000
Rs. 5,00,000
  = 5 Times

 

Balance Sheet: Meaning, Format & Examples

Thanks, Please Like and share with your friends  

Comment if you have any question.

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

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

2 Book 3 min 225x300 - Question 102 Chapter 4 of +2-B  - T.S. Grewal 12 Class
T.S. Grewal’s Analysis of Financial Statements

Leave a Reply