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    Problems On Ratio Analysis

    Uploaded by

    Padyala Sriram
    The document provides financial information and ratios for several problems involving ratio analysis and completing balance sheet statements. Problem 1 provides current and proprietary ratios and asks to prepare a balance sheet. Problem 2 gives gross profit and inventory/debtor/creditor velocity ratios and asks to calculate sales, closing stock, debtors, and creditors. Problem 3 gives financial statements and asks to calculate various ratios. The remaining problems provide additional financial information and ratios and ask to complete balance sheet statements.

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    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd

    Problems On Ratio Analysis

    Uploaded by

    Padyala Sriram
    3K views5 pages
    The document provides financial information and ratios for several problems involving ratio analysis and completing balance sheet statements. Problem 1 provides current and proprietary ratios and asks to prepare a balance sheet. Problem 2 gives gross profit and inventory/debtor/creditor velocity ratios and asks to calculate sales, closing stock, debtors, and creditors. Problem 3 gives financial statements and asks to calculate various ratios. The remaining problems provide additional financial information and ratios and ask to complete balance sheet statements.

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    Problems on Ratio Analysis

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    The document provides financial information and ratios for several problems involving ratio analysis and completing balance sheet statements. Problem 1 provides current and proprietary ratios and asks to prepare a balance sheet. Problem 2 gives gross profit and inventory/debtor/creditor velocity ratios and asks to calculate sales, closing stock, debtors, and creditors. Problem 3 gives financial statements and asks to calculate various ratios. The remaining problems provide additional financial information and ratios and ask to complete balance sheet statements.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    3K views5 pages

    Problems On Ratio Analysis

    Uploaded by

    Padyala Sriram
    The document provides financial information and ratios for several problems involving ratio analysis and completing balance sheet statements. Problem 1 provides current and proprietary ratios and asks to prepare a balance sheet. Problem 2 gives gross profit and inventory/debtor/creditor velocity ratios and asks to calculate sales, closing stock, debtors, and creditors. Problem 3 gives financial statements and asks to calculate various ratios. The remaining problems provide additional financial information and ratios and ask to complete balance sheet statements.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 5

    PROBLEMS ON RATIO ANALYSIS

    From the following information prepare Balance Sheet


    Current Ratio 2.5,
    Liquid Ratio 1.5
    Proprietary Ratio, 0.75,
    Working capital Rs.60,000,
    Reserve and Surplus Rs.40,000,
    Bank Overdraft Rs.10,000
    There is no Long Term Loan or Fictitious Assets.

    PROBLEM NO: II
    Ratios relating Cosmos Ltd are given as follows:
    Gross Profit Ratio:

    15%

    Stock Velocity

    6 months

    Debtors Velocity

    3 months

    Creditors Velocity

    3 months

    Gross Profit

    Rs. 60,000

    Closing is equal to Opening Stock


    Find out:
    Sales
    Closing Stock
    Sundry Debtors
    Sundry Creditors

    PROBLEM 3

    You have been furnished with the financial information of Progressive


    Manufacturing Limited as under:
    Balance sheet as on March 31
    Liabilities

    Assets
    Rs

    Rs

    Equity share capital 10,00,00


    (Rs 100 each)
    0
    Retained earnings

    Plant
    equipment

    3,68,00 Land
    0
    building

    Sundry creditors

    and 6,40,000
    and

    1,04,00 Cash

    80,000
    1,60,000

    0
    Bills Payable
    Other
    liabilities

    2,00,00 Sundry debtors


    0
    Rs 3,60,000
    current
    0

    20,00 Less allowances 3,20,000


    40,000
    Stock

    4,80,000

    Prepaid
    insurance
    16,92,00
    0

    12,000
    16,92,00
    0

    Statement of profit for the year ended March 31.


    Sales

    Rs 40,00,000

    Less cost of goods


    sold

    30,80,000

    Gross profit on sales

    9,20,000

    Less
    expenses

    6,80,000

    operating

    Net profit
    Less taxes (0.35)
    Net profit after taxes

    2,40,000
    84,000
    1,56,000

    Sundry debtors and stock at the beginning of the year were Rs


    3,00,000 and Rs 4,00,000, respectively.
    Determine the
    Manufacturing Ltd:
    a.
    b.
    c.
    d.
    e.
    f.
    g.
    h.
    i.

    following

    ratios

    of

    M/S

    Progressive

    Current ratio
    Acid test ratio
    Stock turnover
    Debtors turnover
    Gross profit ratio
    profit ratio
    Operating ratio
    Earnings per share (EPS)
    Rate of return on equity capital

    PROBLEM 4

    From the following particulars, prepare the Balance Sheet of SR Ltd., as at


    March 31, 2015:
    Current Ratio
    Working Capital
    Capital Block to Current Assets
    Fixed Asset to Turnover
    Cash Sales/Credit Sales
    Debentures/Share Capital
    Stock Velocity
    Creditors Velocity
    Debtors Velocity
    Gross Profit Ratio
    Capital Block:
    Net Profit
    Reserve

    PROBLEM 5

    2
    Rs.5,00,000
    3:2
    2:3
    2:3
    1:3
    3 months
    3 months
    3 months
    30%
    Equity Capital plus Debt
    Capital
    15% of Turnover
    5% of Turnover

    Using the following information, complete the Balance Sheet of PR Ltd.,


    given below:
    Acid Test Ratio
    :
    0.90
    Total Debt to Net Worth
    :
    0.45:1
    Turnover of Total Assets to Sales:
    3:1
    Gross Profit
    :
    40%
    Average Collection Period (Assume 360 days a year) :
    30 days
    Inventory Turnover Ratio
    4 times
    Balance Sheet of PR Ltd., as on ..
    Liabilities
    Bills Payables
    Equity Capital
    Retained Earnings
    Total

    Amount
    Assets
    Rs.
    ????
    Cash
    2,30,000 Bills Receivables
    3,70,000 Inventory
    Plant & Machinery
    ????
    Total

    Amount
    Rs.
    ????
    ????
    ????
    ????
    ????

    PROBLEM 6

    From the following information of SR Ltd., complete the proforma balance


    sheet if its sales are Rs. 32,00,000.
    Sales to Net worth

    2.3 times

    Current Debt to Net Worth

    42%

    Total Debt to Net worth

    75%

    Net Sales to Inventory

    4.7 times

    Current Ratio

    2.9 times

    Average Collection Period

    64 days

    Fixed Assets to Net worth

    53.2%

    Liabilities
    Net worth
    Long term Debt
    Current Debt

    Amount
    Rs.
    ????
    ????
    ????

    Assets
    Fixed Assets
    Cash
    Stock

    Amount
    Rs.
    ????
    ????
    ????

    Total

    ????

    Sundry Debtors
    Total

    Problem 7
    .From the data calculate:
    a.
    b.
    c.
    d.
    e.
    f.

    Gross Profit Ratio


    Net Profit Ratio
    Return on Total Assets
    Inventory Turnover
    Working Capital Turnover
    Net worth to Debt

    Sales

    25,20,000

    Other Current Assets

    7,60,000
    Cost of sale
    Net profit
    15,00,000
    Inventory
    9,00,000
    Current Liabilities

    19,20,000
    14, 40,000
    3,60,000
    8,00,000
    6,00,000

    Fixed Assets
    Net worth
    Debt.

    ????
    ????

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