Question 99 Chapter 4 of +2-B – T.S. Grewal 12 Class

Question 99 Chapter 4 of +2-B

Question 99 Chapter 4 of +2-B

Working Capital Turnover

99. Gross Profit at 25% on cost; Gross profit Rs. 5,00,000; Equity Share Capital Rs. 10,00,000; Reserves and Surplus Rs. 2,00,000; Long-term Loan Rs. 3,00,000; Fixed Assets (Net) Rs. 10,00,000.
Calculate Working Capital Turnover Ratio.

The solution of Question 99 Chapter 4 of +2-B: –

Gross Profit = 25% on Cost
Cost of Goods Sold = X

 

Gross Profit = X + 25
3
Gross Profit 25x
100
Rs. 5,00,000 x 100 25x
X Rs.5,00,00,000
25
X = Rs. 20,00,000

 

Net Sales = Cost of Goods Sold + Gross Profit
  = Rs. 20,00,000 + Rs. 5,00,000
  = Rs. 25,00,000
Working Capital = Capital Employed – Fixed Assets
  = Rs. 15,00,000 – Rs. 10,00,000
  = Rs. 5,00,000

Working Capital Turnover Ratio Cost of Goods Sold
Working Capital
  Rs. 25,00,000
Rs. 5,00,000
  = 5 Times

 

Balance Sheet: Meaning, Format & Examples

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

T.S. Grewal’s Double Entry Book Keeping +2 (Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms)

  • Chapter No. 1 – Financial Statement of Not-For-Profit Organisations
  • Chapter No. 2 – Accounting for Partnership Firms – Fundamentals
  • Chapter No. 3 – Goodwill: Nature and Valuation
  • Chapter No. 4 – Change in Profit-Sharing Ratio Among the Existing Partners
  • Chapter No. 5 – Admission of a Partner
  • Chapter No. 6 – Retirement/Death of a Partner
  • Chapter No. 7 – Dissolution of a Partnership Firm

T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)

T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)

  • Chapter No. 1 – Financial Statements of a Company
  • Chapter No. 2 – Financial Statement Analysis 
  • Chapter No. 3 – Tools of Financial Statement Analysis – Comparative Statements and Common- Size Statements
  • Chapter No. 4 – Accounting Ratios
  • Chapter No. 5 – Cash Flow Statement

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

2 Book 3 min 225x300 - Question 99 Chapter 4 of +2-B  - T.S. Grewal 12 Class
T.S. Grewal’s Analysis of Financial Statements

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