Question 147 Chapter 4 of +2-B – T.S. Grewal 12 Class

Question 147 Chapter 4 of +2-B

Question 147 Chapter 4 of +2-B

Miscellaneous

147. From the following informations, calculate Return on Investment or Return on Capital Employed :

  Rs
Share Capital 5,00,000
Reserves and Surplus 2,50,000
Net Fixed Assets 22,50,000
Non-current Trade Investments 2,50,000
Current Assets 11,00,000
10% Long-term Borrowings 20,00,000
Current Liabilities 8,50,000
Long-term Provision Nil

 

The solution of Question 147 Chapter 4 of +2-B: –

I

Net Profit before tax = Rs 6,00,000
Net Profit before interest, tax and dividend = Net Profit before tax + Interest on long-term borrowings
  = Rs 6,00,000 + Rs 2,00,000
  = Rs 8,00,000
Capital Employed = Share Capital + Reserves and Surplus + Long-term borrowings
  = Rs 5,00,000 + Rs 2,50,000 + Rs 20,00,000
  = Rs 27,50,000
Return on Investment Ratio = Net Profit before interest, tax and dividend X 100
Capital Employed
 Return on Investment Ratio = Rs. 8,00,000 X 100
Rs 27,50,000
  = 29.09%    

 

 

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

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