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Other Illustrations:

llustration :

From the following calculate current ratio

Babu Co. Ltd.
Balance Sheet as on 31.3.04

Liabilities	Rs.	Assets	Rs.
Share capital	21,000	Fixed Assets	17,000
Reserves	4,000	Stock	6,000
Bank Overdraft	2,000	Debtors	3,200
Creditors	6,000	Cash 6,800
	33,000		33,000

Illustration :

From the following Balance Sheet as on 31.3.2005, calculate current ratio and liquid ratio.

Liabilities	Rs.	Assets	Rs.
Equity share capital	40,000	Machinery	45,000
Profit & Loss A/c	4,000	Stock	22,000
Debentures	25,000	Debtors	19,000
Creditors	24,000	Cash	5,000
		Prepaid expenses	2,000
	93,000		93,000

Solution:

Illustration :

From the following, calculate Debt-Equity Ratio.

	Rs.		Rs.
Equity shares	1,00,000	General reserves	75,000
Debentures	75,000	Sundry creditors	40,000
Outstanding expenses	10,000

Solution:

Illustration :

Calculate Gross Profit Ratio from the following:

Rs.

Purchases 2,65,000
Opening stock 10,000
Closing stock 20,000
Sales 3,00,000

Solution:

Illustration :
From the following data, calculate the fixed asset turnover ratio.

Rs.

Cash sales 1,00,000
Credit sales 1,20,000
Sales Returns 20,000
Fixed assets 45,000
Depreciation 5,000

Solution:

Illustration :
From the following trading account, calculate stock turnover ratio and gross profit ratio.

Trading Account of Mohammed Ali & Co.
for the year ended 31.3.2004

Particulars	Rs.	Particulars	Rs.
To Opening stock	40,000	By Sales	2,00,000
To Purchases	1,20,000	By Closing stock	20,000
To Carriage	10,000
To Gross profit	50,000
	2,20,000		2,20,000

Solution:

Illustration :
From the following figures calculate creditors turnover ratio

Rs.

Credit purchases 1,80,000
Bills payable 50,000
Creditors 40,000

Solution:

Illustration :
The following is the Trading & Profit and Loss Account of a firm for the year ended 31.3.04.

Trading and Profit and Loss Account of Lilly & Co.

for the year ended 31.3.2003

Particulars	Rs.	Particulars	Rs.
To Opening stock	35,000	By Sales	4,00,000
To Purchases	2,25,000	By Closing stock	50,000
To Wages	10,000
To Gross profit	1,80,000		__________
	4,50,000		4,50,000

To Administration expenses	10,000	By Gross profit	1,80,000
To Interest	5,000	By Dividend	2,000
To Loss on sale of machinery	2,000
To Selling expenses	10,000
To Net Profit	1,55,000		_________
	1,82,000		1,82,000

Calculate profitability ratios.

Solution:

* Note : Operating ratio = 100% –– Operating profit ratio
= 100% –– 40%
= 60%

Illustration :

From the given data, calculate

1. Gross Profit Ratio

2. Net Profit Ratio and

3. Current Ratio

	Rs.		Rs.
Sales	3,00,000	Cost of goods sold	2,00,000
Net Profit	30,000	Current Assets	60,000
Current liabilities	30,000

Solution :

Illustration :

From the following details calculate

1. Gross Profit Ratio

2. Net Profit Ratio

3. Stock Turnover Ratio

4. Debtors Turnover Ratio

Rs.

Sales 1,50,000
Cost of Goods Sold 1,20,000
Opening Stock 29,000
Closing Stock 31,000
Debtors 15,000
Administration Expenses 15,000

Solution :

Illustration :

From the Balance Sheet given below, calculate Current Ratio & Proprietory Ratio.

Balance Sheet of Ram & Co. Ltd. as on 31.3.2004

Liabilities	Rs.	Assets	Rs.
Share Capital	60,000	Fixed Assets	1,65,000
Reserves	45,000	Current Assets	75,000
Bank overdraft	70,000	Investments (long term)	35,000
Current liabilities	1,20,000	Preliminary expenses	10,000
		Goodwill	10,000
	2,95,000		2,95,000

Solution :

Illustration :

Surya Ltd. provides the following information for the year ending 31.3.05. Calculate Gross Profit ratio, Net profit ratio, Operating profit ratio and Operating ratio.

	Rs.		Rs.
Sales	2,00,000	Gross Profit	80,000
Office Expenses	6,000	Selling Expenses	4,000
Finance expenses	3,000	Loss on sale of plant	400
Interest received	500	Net Profit	67,100

Solution:

Illustration :

From the following Profit and Loss Account of a company, ascertain the following ratios.

1. Gross Profit Ratio

2. Net Profit Ratio

3. Operating Ratio

4. Operating Profit Ratio

5. Stock Turnover Ratio

Trading and Profit & Loss Account for
Dr. the year ending 31.3.2005 Cr.

Particulars	Rs.	Particulars	Rs.
To Opening Stock	10,000	By Sales	56,000
To Purchase	44,000	By Closing stock	10,000
To Gross Profit	20,100		________
	66,000		66,000
To Administration expenses	2,000	By Gross Profit	20,100
To Selling expenses	8,900	By Dividend	1,000
To Interest	3,000	By Profit on sale of investments	800
To Net Profit	8,000		________
	21,900		21,900