# Question 75 Chapter 4 of +2-B – USHA Publication 12 Class Q-75- CH-4 Book 2 - Usha Pub. +2 Book 2020 - Solution

Question 75 Chapter 4 of +2-B

75. (GP Ratio/Operating NP Ratio/NP Ratio) From the following income statement of Modi Chemicals, compute (a) Gross profit ratio (b) Operating net profit ratio and (c) Net profit ratio. Ignore taxation.

 Statement of Profit And Loss Particulars Amount ₹ Revenue from Operations (Sales) 8,43,500 Add Other Income Profit on Sale of Car 20,000 Interest on Investment 40,000 60,000 Total Revenue 9,03,500 Less : Expenses Purchases 4,65,000 Changes in Inventories (Opening Inventory — Closing Inventory) (₹ 30,500 – ₹ 55,000) -24,500 Depreciation 16,000 Factory Expenses 1,43,000 Office Expenses 50,000 Selling Expenses 30,000 Distribution Expenses 20,000 Provision for Doubtful Debts 4,000 Interest on Debenture 14,000 Loss of Cash by Theft 6,000 7,23,500 Net Profit 1,80,000

## The solution of Question 75 Chapter 4 of +2-B: –

 (a) Operating Profit Ratio = ₹ 2,60,000 X 100 ₹ 8,43,500 = 30.82% (b) Net Profit Ratio = ₹ 1,40,000 X 100 ₹ 8,43,500 = 16.60% (c) Operating Ratio = ₹ 1,80,000 X 100 ₹ 8,43,500 = 21.34%
 Cost of goods sold = Opening Stock + Purchases + Factory Expenses – Closing Stock = ₹ 30,500 + ₹ 4,65,000 + ₹ 1,43,000 – ₹ 55,000 = ₹ 5,83,500 Operating Net profit = Net profit + Non operating expenses* – Non-operating incomes** = ₹ 1,80,000 + 20,000 – ₹ 40,000 = ₹ 1,40,000 Gross Profit = Sales – Cost of goods sold = ₹ 8,43,500 – ₹ 5,83,500 = ₹ 2,60,000

 *Non operating expenses = Loss of Cash by Theft + Interest on Debentures = ₹ 6,000 + ₹ 14,000 = ₹ 20,000 **Non operating incomes = Profit on sale of Car + Interest on Investment = ₹ 20,000 + ₹ 40,000 = ₹ 60,000

Also, Check out the solved question of previous Chapters: –