Question 120 Chapter 4 of +2-B – T.S. Grewal 12 Class

Question 120 Chapter 4 of +2-B

Question 120 Chapter 4 of +2-B

Operating Ratio

120. Calculate Operating Profit Ratio, in each of the following alternative
cases:
Case 1: Revenue from Operations Net Sales Rs. 10,00,000; Operating Profit
Rs. 1,50,000.
Case 2: Revenue from Operations Net Sales Rs. 6,00,000; Operating Cost
Rs. 5,10,000.
Case 3: Revenue from Operations Net Sales Rs. 3,60,000; Gross Profit 20%
on Sales; Operating Expenses Rs. 18,000
Case 4: Revenue from Operations Net Sales Rs. 4,50,000; Cost of Revenue
from Operations Rs. 3,60,000; Operating Expenses Rs. 22,500.
Case 5: Cost of Goods Sold, i.e., Cost of Revenue from Operations Rs.
8,00,000; Gross Profit 20% on Sales; Operating Expenses Rs.
50,000.

 

The solution of Question 120 Chapter 4 of +2-B: –

Case I:

Net Sales = Rs. 10,00,000
Operating Profit = Rs. 1,50,000

 

Operating Ratio = Operating Cost X 100
Net Sales
Operating Ratio = Rs. 1,50,000 X 100
Rs. 10,00,000
  = 15%    

 

Case II:

Net Sales = Rs. 6,00,000
Operating Cost = Rs. 5,10,000
Operating Profit = Net Sales – Operating Cost
  = Rs. 6,00,000 – Rs. 5,10,000
  = Rs. 90,000
Operating Ratio = Operating Cost X 100
Net Sales
Operating Ratio = Rs. 90,000 X 100
Rs. 6,00,000
  = 15%    


Case III:

Net Sales = Rs. 3,60,000
Gross Profit = 20% on Sales
Gross Profit = 20 X Rs.3,60,000
100
  = Rs. 72,000    
Operating Profit = Gross Profit – Operating Cost
  = Rs. 72,000 – Rs. 18,000
  = Rs. 54,000
Operating Ratio = Operating Cost X 100
Net Sales
Operating Ratio = Rs. 54,000 X 100
Rs. 3,60,000
  = 15%    

 

Case IV:

Net Sales = Rs. 4,50,000
Cost of Goods Sold = Rs. 3,60,000
Operating Expenses = Rs. 3,60,000
Operating Profit = Gross Profit – Operating Cost
  = Rs. 4,50,000 – Rs. 3,60,000 – Rs. 22,500
  = Rs. 67,500
Operating Ratio = Operating Cost X 100
Net Sales
Operating Ratio = Rs. 67,500 X 100
Rs. 4,50,000
  = 15%    

 

Case V:

Gross Profit = 20% on Sales
Sales = X
Gross Profit = 20 X x
100
Gross Profit = 20x  
100
Sales = Cost Goods Sold + Gross Profit
X = 20x + Rs.8,00,000
100
100x = 20x + Rs. 8,00,00,000
80x = Rs. 8,00,00,000
Gross Profit = Rs. 8,00,00,000
80
Operating Cost = Cost of Goods Sold + Operating Expenses
  = Rs. 8,00,000 + Rs. 50,0000
  = Rs. 8,50,000
Operating Profit = Net Sales – Cost of Goods Sold – Operating Cost
  = Rs. 10,00,000 – Rs. 8,00,000 – Rs. 50,000
  = Rs. 1,50,000
Operating Ratio = Operating Cost X 100
Net Sales
Operating Ratio = Rs. 1,50,000 X 100
Rs. 10,00,000
  = 15%    

 

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 120 Chapter 4 of +2-B  - T.S. Grewal 12 Class
T.S. Grewal’s Analysis of Financial Statements

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