Question 110 Chapter 4 of +2-B – T.S. Grewal 12 Class

Question 110 Chapter 4 of +2-B
Question No. 110- Chapter No.4 - T.S. Grewal +2 Book Part B

Question 110 Chapter 4 of +2-B

Gross Profit Ratio

110. Gross Profit Ratio of a company is 25%. State giving reason, which of the following transactions will a increase or b decrease or c not alter the
Gross Profit Ratio.
(i) Purchases of Stock-in-Trade 50,000.
(ii) Purchases Return 15,000.
(iii) Cash Sale of Stock-in-Trade 40,000.
(iv) Stock-in-Trade costing 20,000 withdrawn for personal use.
(v) Stock-in-Trade costing 15,000 distributed as free sample.

 

The solution of Question 110 Chapter 4 of +2-B: –

 

Transactions
Impact on Gross Profit Ratio Reason
(i) Purchases of Stock-in-Trade 50,000. No Change The amount of Closing Stock is increase and no change in Revenue from Operations.
     
(ii) Purchases Return 15,000. No Change There will be decrease in both Purchase and Closing Inventory And no change in Revenue from Operations.
     
(iii) Cash Sale of Stock-in-Trade 40,000. No Change There will be increase in both Gross Profit and Revenue From Operations.
     
     
(iv) Stock-in-Trade costing 20,000 withdrawn for personal use. No Change The amounts of both Purchase and Closing Inventory is decreased and no any effect on the revenue from operations.
     
(v) Stock-in-Trade costing 15,000 distributed as free sample. No Change There will be decrease in both Purchase and Closing Inventory And no change in Revenue from Operations.
     

 

 

 

 

 

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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)

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)

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

Question 1 Chapter 1 of +2-B
T.S. Grewal’s Analysis of Financial Statements

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