Question 140 Chapter 4 of +2-B
Table of Contents
Miscellaneous
140. Calculate following ratios on the basis of the following information:
(i)Gross Profit Ratio;
(ii)Current Ratio;
(iii)Acid Test Ratio; and
(iv) Inventory Turnover Ratio.
| Rs | Rs | ||
| Gross Profit | 50,000 | Revenue from Operations | 1,00,000 |
| Inventory | 15,000 | Trade Receivables | 27,500 |
| Cash and Cash Equivalents | 17,500 | Current Liabilities | 40,000 |
The solution of Question 140 Chapter 4 of +2-B: –
I
| Gross Profit Ratio | = | Gross Profit | X | 100 |
| Revenue from Operations |
| Gross Profit Ratio | = | Rs. 50,000 | X | 100 |
| Rs 1,00,000 | ||||
| = | 50% |
II
| Current Ratio | = | Current Assets |
| Current Liabilities |
| Current Assets | = | Inventory + Cash and Cash Equivalents + Trade Receivables |
| = | Rs 60,000 | |
| Current Liabilities | = | Rs 40,000 |
| Current Ratio | = | Rs. 60,000 |
| Rs 40,000 | ||
| = | 1.5 : 1 |
III
| Liquid Ratio | = | Liquid Assets |
| Current Liabilities |
| Liquid Assets | = | Cash and Cash Equivalents + Trade Receivables |
| = | Rs 17,500 + Rs 27,500 | |
| = | Rs 45,000 |
| = | Rs 45,000 | |
| Rs 40,000 | ||
| = | 1.125 : 1 |
IV
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| Inventory Turnover Ratio | = | Cost of Goods Sold |
| Average Inventory |
| Cost of Goods Sold | = | Revenue from Operations − Gross Profit |
| = | Rs 1,00,000 − Rs 50,000 | |
| = | Rs 50,000 | |
| Average Inventory | = | Rs 15,000 |
| = | Rs 50,000 | |
| Rs 15,000 | ||
| = | 3.33 Times |
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)
- Chapter No. 8 – Company Accounts – Accounting for Share Capital
- Chapter No. 9 – Company Accounts – Issue of Debentures
- Chapter No. 10 – Redemption of Debentures
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
