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

Question No -54 Chapter no - 7 Unimax Class - 12 Part -II

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

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
 Net profit before tax 1,80,000 Add: 12% on 6,00,000 72,000 Net profit before int & tax 2,52,000
 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

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