Question 108 Chapter 4 of +2-B – T.S. Grewal 12 Class

Question 108 Chapter 4 of +2-B

Question 108 Chapter 4 of +2-B

Gross Profit Ratio

108. Calculate Gross Profit Ratio from the following data:
Average Inventory Rs. 3,20,000; Inventory Turnover Ratio 8 Times;
Average Trade Receivables Rs. 4,00,000; Trade Receivables Turnover
Ratio 6 Times; Cash Sales 25% of Net Sales.

 

The solution of Question 108 Chapter 4 of +2-B: –

Inventory Turnover Ratio = 8 Times
Average Inventory = Rs 3,20,000

 

Inventory Turnover Ratio = Cost of Goods Sold
Average Inventory
8 = Cost of Goods Sold
Rs. 3,20,000
  = 3,20,000 x 8
Cost of Goods Sold = Rs. 25,60,000

 

Trade Receivables Turnover Ratio = 6 Times
Average Trade Receivables = Rs. 4,00,000
Trade Receivables Turnover Ratio = Net Credit Sales
Average Trade Receivable
6 = Net Credit Sales
Rs. 4,00,000
Net Credit Sales = Rs. 4,00,000 x 6
  = Rs. 24,00,000
Total Sales = Cash Sales + Credit Sales
Total Sales = 25% of Total Sales + Credit Sales
75% of Total Sales = Rs 24,00,000
Total Sales = Rs. 24,00,000
75%
  = Rs 32,00,000
Gross Profit = Total Sales – Cost of Goods Sold
  = Rs. 32,00,000 – Rs. 25,60,000
  = Rs. 6,40,000

Revenue from Operations = Gross Profit X 100
Net Sales
Revenue from Operations = Rs. 6,40,000 X 100
Rs.32,00,000
  = 20%
   

 

Balance Sheet: Meaning, Format & Examples

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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)

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

2 Book 3 min 225x300 - Question 108 Chapter 4 of +2-B  - T.S. Grewal 12 Class
T.S. Grewal’s Analysis of Financial Statements

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