# Question 72 Chapter 7 -Unimax Publication Class 12 Part 2 – 2021

Question No -72 Chapter no - 7 Unimax Class - 12 Part -II

Question 72 Chapter 7 – Unimax Publication Class 12 Part 2 – 2021

With the help of the given information calculate the following ratios:
(I) operating ratio, (ii) quick ratio, (iii) working capital turnover ratio and (iv) debt to total funds ratio.
Information. Equity share capital 1,00,000 ; 12% preference share capital 80,000 ; 12% debentures 60,000 ; general reserve 40,000 ; sale 3,00,000 ; opening stock 10,000 ; purchases 1,20,000 ; wages 30,000 ; closing stock 30,000 ; selling and distribution expenses 10,000 ; other current assets 2,00,000 and current liabilities 1,20,000.

## The solution of Question 72 Chapter 7 – Unimax Publication Class 12 Part 2-2021 : –

 (I) Quick ratio = quick assets current liabilities
 = 2,00,000 1,20,000 = 1.67 : 1 Ans.
 (ii) C.O.G.S. = opening stock + net purchases + direct expenses – closing stocks = 10,000 + 1,20,000 + 30,000 – 30,000 = 1,30,000 Operating cost = C.O.G.S. + operating expenses = 1,30,000 + 10,000 = ₹ 1,40,000
 Operating ratio = operating cost x 100 Net sales
 = 1,40,000 x 100 3,00,000 = 46.67 % Ans.
 (iii) working capital = current assets – current liabilities = 2,00,000 + 30,000 – 1,20,000 = 1,10 000
 Working capital = Net sales working capita
 Turnover Ratio = 3,00,000 1,10,000 = 2.73 times Ans.

 (iv) long term debts to total funds ratio = long term debts long term funds
 = 60,000 1,00,000 + 80,000 +60,000+ 40,000
 = 60,000 2,80,000 = 0.214 : 1 Ans.

Comment if you have any Doubts.

Accounting Ratios – Meaning and Definition