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 Capital 2.90.000
Reserves and Surplus  
Profit for the year 60,000
Reserve  
Underwriting Commission  
Non Current Liabilities  
Long term Borrowings 1,15,000
10% Loans 15,000
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 & Tax X 100
Capital Employed
         
  = ₹ 13,00,000 X 100
  ₹ 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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