Question 54 Chapter 7 -Unimax Publication Class 12 Part 2

Question 54 Chapter 7 – Unimax Publication Class 12 Part 2 – 2021

Table of Contents

54. From the following calculate return on investment (or return on capital employed)

S.NO.	Items	Amount
1.	Share capital	1,00,000
2.	Reserve and surplus	50,000
3.	Net fixed assets	4,50,000
4.	Non-current trade investments	50,000
5.	Current assets	2,20,000
6.	12% long term borrowings	4,00,000
7.	Current liabilities	1,70,000

Net profit before tax 1,20,000.

The solution of Question 54 Chapter 7 – Unimax Publication Class 12 Part 2-2021 : –

Return on investment or return on capital employed	=	Net profit before interest and tax	x	100
		Capital Employed

Capital employed	=	share capital + reserve & surpluses + 12% long term borrowings
	=	1,50,000 + 75,000 + 6,00,000 + = 8,25,000

Return on investment or return on capital employed	=	2,52,000	x	100	=	30.54
		8,25,000

Thanks, Please Like and share with your friends

Comment if you have any Doubts.

Accounting Ratios – Meaning and Definition

Chapter No. 1 – Company Accounts (Share Capital)
Chapter No. 2 – Company Accounts (Issue of Debentures)
Chapter No. 3 – Company Accounts (Redemption of Debentures)
Chapter No. 4 – Financial Statements of a Company
Chapter No. 5 – Financial Statement Analysis
Chapter No. 6 – Tools of Financial Statement Analysis- Comparative and Common Size
Chapter No. 7 – Ratio Analysis
Chapter No. 8 – Cash Flow Statement