Question 82 Chapter 4 of +2-B

Question 82 Chapter 4 of +2-B

Return on Capital Employed

82. (Return on Investment) From the following details calculate Return on Investment

Preference share Capital1,00,000
Equity share capital 2,00,000
10% Debentures3,00,000
General Reserve50,000
Current liabilities75,000
Net Profit (after debenture Interest but before Income Tax) 50,000

 

The solution of Question 82 Chapter 4 of +2-B: – 

 

Return On Capital Employed Ratio=Net Profit before Interest and TaxX100
Capital Employed
 =   
 =₹ 80,000X100
 ₹ 6,50,000
 =12.30%  

 

 

Net profit before interest and Tax=Net Profit + Interest on Debentures
 =₹ 50,000 + ₹ 30,000
 =₹ 80,000
Capital Employed=Equity Share capital + Preference Share Capital + General Reserve + Debentures
 =₹ 2,00,000 + ₹ 1,00,000 + ₹ 50,000 + ₹ 3,00,000
 =₹ 6,50,000



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

Usha Publication – Accountancy PSEB (Class 12) – Volume I – Solution

Usha Publication – Accountancy PSEB (Class 12) – Volume II – Solution

Check out T.S. Grewal +2 Book 2020@ Official Website of Sultan Chand Publication

2 Book 3 min 225x300 - Question 82 Chapter 4 of +2-B  - USHA Publication  12 Class
T.S. Grewal’s Analysis of Financial Statements

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