Question 120 Chapter 4 of +2-B – USHA Publication 12 Class

Question 120 Chapter 4 of +2-B

Question 120 Chapter 4 of +2-B

Miscellaneous (Analytical Questions)

120. (Return on Capital Employed) From the following Balance sheet of ABC Ltd. as on 31st March 2018.

BALANCE SHEET 
Particulars 
I. Equity and Liabilities 
Shareholders’ Funds 
Share Capital2.90.000
Reserves and Surplus 
Profit for the year60,000
Reserve 
Underwriting Commission 
Non Current Liabilities 
Long term Borrowings1,15,000
10% Loans15,000
Current Liabilities 
Trade Payable 
 4,80,000
II. Assets :  
Non-Current Assets  
Tangible Assets 
Fixed Assets 2,30,000
Current Assets 
 4,80,000

Calculate return on capital employed

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

 

Profit before Interest & Tax=₹ 12,00,000
Add Interest=₹ 1,00,000
 =₹ 13,00,000
Capital Employed(Asset side)=Fixed Assets + Current Assets – Current Liabilities
 =₹ 29,00,000 + ₹ 25,00,000 – 8,00,000
 =₹ 46,00,000
Capital Employed(Liabilities side)=Share Capital + Reserve and Profit + Loans – Underwriting Commission
 =₹ 20,00,000 + ₹ 17,00,000 + ₹ 10,00,000 – ₹ 1,00,000
 =₹ 46,00,000

 

Return on Capital Employed

=Profit before Interest & TaxX100
Capital Employed
     
 =₹ 13,00,000X100
 ₹ 46,00,000
 =28.26%  

 


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

Usha Publication – Accountancy PSEB (Class 12) – Volume I – Solution

Usha Publication – Accountancy PSEB (Class 12) – Volume II – Solution

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  - USHA Publication 12 Class
T.S. Grewal’s Analysis of Financial Statements

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