Accountancy

From the following, calculate (a) Debt to Equity Ratio; (b) Total Assets to Debt Ratio; and (c) Proprietary Ratio:

Equity Share Capital75,000Debentures 75,000Preference Share Capital 25,000Trade Payable 40,000General Reserve45,000Outstanding Expenses 10,000Balance in Statement of Profit and Loss30,000   SOLUTION Debt to Equity Ratio = Long term Debts / Shareholders' FundsDebt to Equity Ratio = DebenturesEquity = Share Capital + Preference Share Capital + General Reserve + Balance…

Continue ReadingFrom the following, calculate (a) Debt to Equity Ratio; (b) Total Assets to Debt Ratio; and (c) Proprietary Ratio:

On the basis of the following information calculate: (i) Debt to Equity Ratio. (ii) Working Capital Turnover Ratio. Information:

ParticularsAmount(Rs.)ParticularsAmount(Rs.)Revenue from Operations: Paid-up Share Capital17,00,000(a) Cash Sales40,00,0006% Debentures3,00,000 (b) Credit Sales20,00,0009% Loan from Bank7,00,000Cost of Goods Sold35,00,000Debentures Redemption Reserve3,00,000Other Current Assets8,00,000Closing Inventory 1,00,000Current Liabilities4,00,000 SOLUTION (i) Long-term Debts = 6% Debentures +…

Continue ReadingOn the basis of the following information calculate: (i) Debt to Equity Ratio. (ii) Working Capital Turnover Ratio. Information:

From the information given below, calculate any three of the following ratio:(i) Gross Profit Ratio. (ii) Working Capital Turnover Ratio. (iii) Debt to Equity Ratio. (iv) Proprietary Ratio.

 ParticularsAmount(Rs.) ParticularsAmount(Rs.)Revenue from Operations (Net Sales)5,00,000Current Liabilities1,40,000Cost of Revenue from Operations (Cost of Goods Sold) 3,00,000Paid-up Share Capital2,50,000Current Assets2,00,00013% Debentures1,00,000 SOLUTION (i) Net Sales = 5,00,000Cost of Goods Sold = 3,00,000Gross Profit…

Continue ReadingFrom the information given below, calculate any three of the following ratio:(i) Gross Profit Ratio. (ii) Working Capital Turnover Ratio. (iii) Debt to Equity Ratio. (iv) Proprietary Ratio.

Calculate following ratios on the basis of the following information: (i) Gross Profit Ratio. (ii) Current Ratio. (iii) Acid Test Ratio. (iv) Inventory Turnover Ratio.

  Particulars Amount(Rs.) ParticularsAmount(Rs.)Gross Profit50,000Revenue from Operations1,00,000Inventory15,000Trade Receivables27,500Cash and Cash Equivalents17,500Current Liabilities40,000 SOLUTION Gross Profit Ratio = Gross Profit / Revenue from Operations × 100Gross Profit Ratio = 50,000 / 1,00,000 × 100= 50%Current Ratio = Current Assets / Current LiabilitiesCurrent Ratio =…

Continue ReadingCalculate following ratios on the basis of the following information: (i) Gross Profit Ratio. (ii) Current Ratio. (iii) Acid Test Ratio. (iv) Inventory Turnover Ratio.

From the following calculate:(a) Current Ratio; and  (b) Working Capital Turnover Ratio.

  ParticularsAmount(Rs.)(i)Revenue from Operations1,50,000(ii)Total Assets1,00,000(iii)Shareholders' Funds60,000(iv)Non-current Liabilities20,000(v)Non-current Assets50,000 SOLUTION A) Current Ratio = Current Assets Current Liabilities                         Current Assets = Total Assets – Non Current Assets= 1,00,000 – 50,000= Rs. 50,000 Total Assets = Total LiabilitiesTotal Liabilities = Shareholders’ Funds +…

Continue ReadingFrom the following calculate:(a) Current Ratio; and  (b) Working Capital Turnover Ratio.

From the following information, calculate Inventory Turnover Ratio; Operating Ratio and Working Capital Turnover Ratio: Opening Inventory Rs. 28,000; Closing Inventory Rs. 22,000; Purchases Rs. 46,000; Revenue from Operations, i.e., Net Sales Rs. 80,000; Return Rs. 10,000; Carriage Inwards Rs. 4,000; Office Expenses Rs. 4,000; Selling and Distribution Expenses Rs. 2,000; Working Capital Rs. 40,000. 

SOLUTION (i) Opening Inventory = 28,000Closing Inventory = 22,000Average Inventory = (Opening Inventory + Closing Inventory) / 2= (28,000 + 22,000) / 2= Rs 25,000 Cost of Goods Sold =…

Continue ReadingFrom the following information, calculate Inventory Turnover Ratio; Operating Ratio and Working Capital Turnover Ratio: Opening Inventory Rs. 28,000; Closing Inventory Rs. 22,000; Purchases Rs. 46,000; Revenue from Operations, i.e., Net Sales Rs. 80,000; Return Rs. 10,000; Carriage Inwards Rs. 4,000; Office Expenses Rs. 4,000; Selling and Distribution Expenses Rs. 2,000; Working Capital Rs. 40,000. 

From the following information, calculate any two of the following ratios: (i) Current Ratio; (ii) Debt to Equity Ratio; and (iii) Operating Ratio. Revenue from Operations (Net Sales) Rs. 1,00,000; cost of Revenue from Operations (Cost of Goods Sold) was 80% of sales; Equity Share Capital Rs. 7,00,000; General Reserve Rs. 3,00,000; Operating Expenses Rs. 10,000; Quick Assets Rs. 6,00,000; 9% Debentures Rs. 5,00,000; Closing Inventory Rs. 50,000; Prepaid Expenses Rs. 10,000 and Current Liabilities Rs. 4,00,000.

SOLUTION (i)Current Assets = Quick Assets + Closing Stock + Prepaid Expenses= 6,00,000 + 50,000 + 10,000= 6,60,000Current Liabilities = 4,00,000Current ratio = Current assets / Current liabilities= 4,00,000 / 2,00,000=2:1=…

Continue ReadingFrom the following information, calculate any two of the following ratios: (i) Current Ratio; (ii) Debt to Equity Ratio; and (iii) Operating Ratio. Revenue from Operations (Net Sales) Rs. 1,00,000; cost of Revenue from Operations (Cost of Goods Sold) was 80% of sales; Equity Share Capital Rs. 7,00,000; General Reserve Rs. 3,00,000; Operating Expenses Rs. 10,000; Quick Assets Rs. 6,00,000; 9% Debentures Rs. 5,00,000; Closing Inventory Rs. 50,000; Prepaid Expenses Rs. 10,000 and Current Liabilities Rs. 4,00,000.

Following information is given about a company: 

 Particulars Amount(Rs.) Particulars Amount(Rs.)Revenue From Operations, i.e., Net Sales Gross Profit1,50,000Opening Inventory29,000Cost of Revenue From Operations30,000Closing Inventory31,000(Cost of Goods Sold)1,20,000Debtors16,000 From the above information, calculate following ratios:(i) Gross Profit Ratio,(ii) Inventory Turnover Ratio, and (iii) Trade…

Continue ReadingFollowing information is given about a company: 

Opening Inventory Rs. 80,000; Purchases Rs. 4,30,900; Direct Expenses Rs. 4,000; Closing Inventory Rs. 1,60,000; Administrative Expenses Rs. 21,100; Selling and Distribution Expenses Rs. 40,000; Revenue from Operations, i.e., Net Sales Rs. 10,00,000. Calculate Inventory Turnover Ratio; Gross Profit Ratio; and Opening Ratio.

SOLUTION (i) Opening Inventory = 80,000Closing Inventory = 1,60,000Cost of Goods Sold = Opening Inventory + Purchases + Direct Expenses − Closing Inventory= 80,000 + 4,30,900 + 4,000 − 1,60,000= 3,54,900…

Continue ReadingOpening Inventory Rs. 80,000; Purchases Rs. 4,30,900; Direct Expenses Rs. 4,000; Closing Inventory Rs. 1,60,000; Administrative Expenses Rs. 21,100; Selling and Distribution Expenses Rs. 40,000; Revenue from Operations, i.e., Net Sales Rs. 10,00,000. Calculate Inventory Turnover Ratio; Gross Profit Ratio; and Opening Ratio.