12 Accountancy sp10
12 Accountancy sp10
12 Accountancy sp10
Class 12 - Accountancy
Maximum Marks: 80
General Instructions:
a) ₹1,418.33
b) ₹1,408.33
c) ₹1,418.93
d) ₹1,408.93
2. Assertion (A): Profit or loss on revaluation of assets and reassessment of liabilities is transferred to the old
partners' Capital account/Current account in old profit sharing ratio.
Reason (R): All the accumulated profits or losses and reserves are transferred to old partners’ capital account/current
account in the old profit sharing ratio.
OR
d) All of these
4. T Ltd. Purchased a machine from L Co. for ₹60,000. It was decided to pay ₹5,000 in cash and balance will be paid by
the issue of shares of ₹10 each. Pass journal entries if shares Issued at a premium of 10%
OR
20,000 shares issued for public subscription having face value Rs.10 at a premium of 10%. The full amount was payable
on application. Applications were received for 30,000 shares and pro-rata allotment was made. Find the amount to be
recorded in Share Capital Account?
a) 3,30,000
b) 2,00,000
c) 1,10,000
d) 3,00,000
5. Which of the following statement is/are correct?
A. Interest on debentures is paid before paying any dividend
B. Debentures cannot be issued as ‘Collateral Security’
C. Debentures can be issued in cash only
D. Debentures are shown under head Shareholders fund under balance sheet
a) (B)
b) (C)
c) (D)
d) (A)
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6. A and B share profits and losses in the ratio of 5:2. They have decided to dissolve the firm. Assets and external liabilities
have been transferred to Realisation A/c. It is found that an unrecorded Computer was realized ₹7,000. How would you
record it?
a)
Bank A/c Dr. 7,000
To Realisation A/c 7,000
b)
OR
There was an unrecorded liability regarding creditors of ₹5,000. The actual amount was decided to settle this liability
was ₹3,100. Mohan (one partner) is ready to pay that liability. The entry will be:
a)
Realisation A/c Dr. 1,900
To Mohan’s Capital A/c 1,900
b)
Realisation A/c Dr. 5,000
To Mohan’s Capital A/c 5,000
c)
Realisation A/c Dr. 3,100
To Mohan’s Capital A/c 3,100
d) No Entry
7. X Limited forfeited 1,000 shares of 10 each for the non-payment of the final call of Rs.2 per share. These shares were
reissued @ Rs.8 per share fully paid up. Find out the amount of capital reserve.
OR
Sofia Ltd. issued 4000 8% Debentures of ₹100 each payable as Follows ₹20 on Application ₹30 on Allotment ₹50 on
First and Final call All the debentures calls were applied for and allotted. All the calls were duly Received. By what
a) ₹120000
b) ₹200000
c) ₹250000
d) ₹100000
Question No. 9 to 10 are based on the given text. Read the text carefully and answer the questions:
A, B and C are partners sharing profit and losses in the ratio 3:2:1. From 1st April 2018, A, B and C decided to share profit and losses
equally. This may result in the gain to a few partners and loss to other.
9. From 1st April 2018, A, B and C decided to share profit and losses equally. It is a:
a) None of these
b) None of these
c) Sacrificing ratio
d) Gaining ratio
11. Vinod Limited offered 20,000 debentures @ 100 each at a premium of 10%. The issue was oversubscribed by 3 times.
The company made full allotment to 4,000 applicants and pro-rata allotment made to the 36,000 applicants and
remaining applications are rejected. How much amount is to be refunded by the company?
a) 22,00,000
b) 33,00,000
c) 44,00,000
d) 18,00,000
12. Vivek and Vishal are partners with a capital of ₹26000 and ₹22000 respectively. They admit David as a partner for 1
share in the profits of the firm. David brings ₹30,000 (including 4,000 premium for goodwill) as his share of capital and
premium. Journal entry for capital amount brought by a new partner
a)
Bank A/c ... Dr. 34,000
To Vivek's Capital A/c 34,000
b)
Bank A/c ... Dr. 22,000
To Goodwill A/c 22,000
c)
Bank A/c ... Dr. 26,000
To David’s Capital A/c 26,000
d)
Bank A/c ... Dr. 30,000
To David’s Capital A/c 30,000
13. Accounting Standard ________ requires goodwill should be recorded in the books of accounts only when some money
or money’s worth is paid for it.
a) 27
b) 10
d) 23
14. A, B and C are partners. They admit D and guarantee that his share of profit will not be less than Rs. 20,000. Profits to
be shared 4:3:3:2 respectively. Total profits were Rs. 96,000. It was agreed that the deficiency amount (if any) payable to
D over his share will be borne by A, B and C in the ratio of 3:2:1. Calculate the share of profit for each partner.
OR
a) Share of goodwill
b) Loss on Revaluation
c) General Reserve
d) Profit on Revaluation
16. When the value of goodwill is not given at the time of admission of a new partner, it is inferred from the capital of the
new firm and profit-sharing ratio. This concept is called ________.
a) Purchased Goodwill
c) Average Goodwill
d) Hidden Goodwill
17. A, B, C and D are partners sharing profits in the ratio of 2 : 4 : 3 : 1. C retires and for this purpose, goodwill is valued at
two year’s purchase of average super-profits of last four years, which are as under:
I Year ₹ 40,000
II Year ₹ 10,000 (Loss)
III Year ₹ 1,00,000
IV Year ₹ 1,50,000
The normal profits for similar firms are ₹ 56,000.
REALISATION ACCOUNT
Dr. Cr.
Particulars ₹ Particulars ₹
To Sundry Assets: By Sundry Liabilities:
Stock A/c 59,400 Provision for Bad Debts A/c 3,000
Debtors A/c 57,000 Creditors A/c 46,200
Plant and Machinery A/c 1,31,000 2,47,500 Bills Payable A/c 10,800 60,000
To Bank A/c (Liabilities paid off) ? By ?
To ? By Bank A/c (Assets realised):
Stock 45,000
Goodwill 12,000
Debtors 34,200
Plant and Machinery 90,000 ?
By Loss on realisation transferred to:
A's Capital A/c ?
B's Capital A/c ?
C's Capital A/c 9,450 ?
? ?
Dr. Cr.
Particulars ₹ Particulars ₹
CAPITAL ACCOUNTS
Dr. Cr.
Particulars A B C Particulars A B C
₹ ₹ ₹ ₹ ₹ ₹
To ? ? ? By ? ? ?
To Bank A/c (Final Payment) ? ? ? By Workmen Compensation Reserve ? 3,000 ?
By Bank A/c (Amount brought in) ? 3,900 ?
? 18,900 ? 64,500 ? 61,500
BANK ACCOUNTS
Dr. Cr.
Particulars ₹ Particulars ₹
To Balance b/d ? By Realisation A/c (Liabilities Paid) ?
To Realisation A/c (Sale of unrecorded asset) 15,000 By Realisation A/c (Exp.) 2,400
To ? By Loan From A A/c 57,000
To ? By ?
By ?
? ?
23. Manvet Ltd. invited applications for issuing 10,00,000 equity shares of ₹10 each payable as follows:
Applications for 15,00,000 shares were received and pro-rata allotment was made to all the applicants. Excess
application money was adjusted on the sums due on calls. A shareholder who had applied for 6,000 shares did not pay
the first, and the second and final call. His shares were forfeited. 90% of the forfeited shares were reissued at ₹8 per
share fully paid up.
Pass necessary journal entries for the above transactions in the books of the company.
24. Brijesh, Charu and Dilip are partners sharing profits and losses in the ratio of 3: 2: 1. Their balance sheet as at 31st
March, 2016 was as follows:
Liabilities ₹ Assets ₹
Creditors 87,000 Cash 30,000
Reserve 42,000 Debtors 62,000
Profit & Loss A/c (Profits) 21,000 Less: Provision for doubtful debs 2,000 60,000
Capital Accounts: Stock 1,80,000
Brijesh 3,00,000 Furniture 30,000
Charu 3,00,000 Plant 2,00,000
Dilip 50,000 6,50,000 Building 3,00,000
8,00,000 8,00,000
The partners agreed that from 1st April, 2016 they will share profits and losses in the ratio of 4: 4: 1. They agreed that:
i. Stock is to be valued at 20% less.
ii. Provision for doubtful debts to be increased by ₹ 1,500.
iii. Furniture is to be depreciated by 20% and plant by 15%.
iv. ₹ 3,500 are outstanding for salaries.
v. Building is to be valued at ₹ 3,50,000.
vi. Goodwill is valued at ₹ 45,000.
Partners do not want to record the altered values of assets and liabilities in the books and want to leave the reserves and
profits undisturbed. You are required to pass a single journal entry to give effect to the above. Also, prepare the revised
balance sheet.
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25. Lokesh, Mansoor and Nihal were partners in a firm sharing profits as 50%, 30% and 20% respectively. On 31st March,
2014, their balance sheet was as follows:
Liabilities Amount (Rs) Assets Amount (Rs)
Creditors 34,000 Cash 68,000
Provident Fund 10,000 Stock 38,000
Investment Fluctuation Fund 20,000 Debtors 94,000
Capital A/cs: (-) Provision 6,000 88,000
Lokesh 1,40,000 Investments 80,000
Mansoor 80,000 Goodwill 40,000
Nihal 50,000 2,70,000 Profit and Loss 20,000
3,34,000
3,34,000
========= ========
On the above date, Mansoor retired and Lokesh and Nihal agreed to continue on the following terms:
i. Firm’s goodwill was valued at Rs 1,02,000 and it was decided to adjust Mansoor’s share of goodwill into the capital
accounts of the continuing partners.
ii. There was a claim for workmen’s compensation to the extent of Rs 12,000 and investments were brought down to Rs
30,000.
iii. Provision for bad debts was to be reduced by Rs 2,000.
iv. Mansoor was to be paid Rs 20,600 in cash and the balance will be transferred to his loan account which was paid in
two equal instalments together with interest @ 10% per annum.
v. Lokesh’s and Nihal’s capitals were to be adjusted in their new profit sharing ratio by bringing in or paying off cash as
the case may be.
Prepare revaluation account and partners’ capital accounts.
26. Pass necessary Journal entries relating to the issue of debentures for the following:
a. Issued ₹ 4,00,000; 9% Debentures of ₹ 100 each at a premium of 8% redeemable at 10% premium.
b. Issued ₹ 6,00,000; 9% Debentures of ₹ 100 each at par, repayable at a premium of 10%.
c. Issued ₹ 10,00,000; 9% Debentures of ₹ 100 each at a premium of 5%, redeemable at par.
Part B :- Analysis of Financial Statements
27. Interest on long term borrowings is an ________ relating to financial activities and shown as ________ of cash.
a) Expense, Outflow
c) Outflow, Income
d) Expense, Income
OR
A Ltd engaged in the business retailing of Air-Conditioners, invested Rs. 25, 00,000 in the shares of a manufacturing
company. Dividend received on this investment will be:
c) Cash Equivalent
c) Subjectivity
d) Window Dressing
29. Which of the following is not a source of finance?
a) Fixed Assets
b) Debentures
c) Bank Loan
d) Bank Overdraft
OR
a) Financing Activities
b) Investing Activities
c) No Effect
d) Operating Activities
30. Why government is interested in analysis financial statement
Gross Profit ₹ 1,00,000; Office and Administrative Expenses ₹ 10,000; Selling and Distribution Expenses ₹ 25,000;
Interest on Long-term Debts ₹ 8,000; Tax ₹ 12,000; Non Current Assets ₹ 3,00,000; Current Assets ₹ 1,50,000 and
Current Liabilities ₹ 1,25,000.
Case 1: Revenue from Operations (Net Sales) ₹ 10,00,000; Operating Profit ₹ 1,50,000.
Case 2: Revenue from Operations (Net Sales) ₹ 6,00,000; Operating Cost ₹ 5,10,000.
Case 4: Revenue from Operations (Net Sales) ₹ 3,60,000; Gross Profit 20% on Sales; Operating Expenses ₹ 18,000
Case 4: Revenue from Operations (Net Sales) ₹ 4,50,000; Cost of Revenue from Operations ₹ 3,60,000; Operating
Expenses ₹ 22,500.
Case 5: Cost of Goods Sold, i.e., Cost of Revenue from Operations ₹ 8,00,000; Gross Profit 20% on Sales; Operating
Expenses ₹ 50,000.
OR
Cash Revenue from Operations ₹1,00,000; Credit Revenue from Operations ₹3,00,000; Gross Profit 30% on Revenue
from Operations; Inventory Turnover Ratio = 2 Times.
Calculate Opening Inventory and Closing Inventory in each of the following cases:
Case 2: If Closing Inventory is 25% less than the inventory in the beginning.
Case 3: If Opening Inventory is 75% of Closing Inventory and Closing Inventory is 30% of Revenue from Operations.
34. From the following Balance Sheet of Young India Ltd., prepare Cash Flow Statement:
Particulars Note No. 31.3.2019 31.3.2018
₹ ₹
I. Equity and Liabilities:
1. Shareholders Funds:
(a) Share Capital 2,50,000 2,00,000
(b) Reserve and Surplus: Surplus, i.e., Balance in Statement of Profit and Loss 1,83,000 82,000
2. Non-Current Liabilities:
Long-term Borrowings
15% Debentures 80,000 50,000
3. Current Liabilities:
(a) Trade Payables 1,50,000 1,10,000
(b) Other Current Liabilities 12,000 20,000
Total 6,75,000 4,62,000
II. Assets:
1. Non-Current Assets:
(a) Fixed Assets (Tangible) 2,74,000 1,17,000
(b) Non-Current Investments 68,000 55,000
2. Current Assets:
(a) Investments 2,06,000 1,50,000
(b) Trade Receivables 32,000 70,000
(c) Cash and Cash Equivalents 95,000 70,000
Total 6,75,000 4,62,000
Class 12 - Accountancy
Solution
Explanation: When amounts are different for each drawing and dates of drawings are also different, in such a case
Product method should be used to calculate the interest on drawings:
Amount (A) Months (B) Products (A× B)
6,000 11 66,000
4,000 09 36,000
8,000 06 48,000
3,000 03 9,000
5,000 02 10,000
Interest on drawings Charged During the year = Total products × Rate of Drawing × 1
12
= Rs.1,69,000 × = Rs.1,408.33
10 1
×
100 12
OR
55,000
Explanation: No. of shares issued = 11
= 5,000
OR
(b) 2,00,000
Explanation: Amount to be adjusted in share capital account is no.of shares invited for × face value of shares
Explanation: Interest on debentures is paid before paying any dividend. Interest is charged against profit. Following
statement are false:
Debentures cannot be issued as ‘Collateral Security’
Debentures can be issued in cash only
Debentures cannot be issued at a discount
OR
(c)
Realisation A/c Dr. 3,100
To Mohan’s Capital A/c 3,100
Explanation: When liabilities are paid, should be recorded at the paid amount and not at the actual value of the liability.
When liability is paid by a partner then the entry will be:
Realisation A/c Dr. 3,100
To Mohan’s Capital A/c 3,100
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7. (b) Capital Reserve ₹6,000
Explanation: The amount of capital reserve will be calculated as = (amount of shares forfeited/no of shares forfeited ×
no of shares reissued) - amount of discount on the reissue
Explanation: The following journal entry will be recorded for the issue of debentures:
Bank A/c ... Dr. 1,10,000
Note: In this first journal entry there is no need to show premium separately Premium will be shown in Transfer entry
(i.e. at the time of transfer to capital A/c).
OR
(a) ₹120000
No of debentures = 4000
Explanation: Company has to refund Rs.44,00,000. Excess money received from 40000 applicants will be refunded.
Explanation: As per Accounting Standard 26, issued by Institute of Chartered Accountants of India (ICAI), Goodwill
should be recorded in the books only when some consideration in money or money's worth has been paid for it. Hence
only Purchase Goodwill is recorded in the books of Account.
14. (d) A= ₹30,000, B= ₹22,667, C= ₹23,333 and D= ₹20,000
12
= 32,000 - 2,000 = Rs. 30,000
12
12
12
= 16,000 + 4,000 = Rs. 20,000
D’s Guaranteed amount is Rs.20,000 but he is getting Rs.16,000 (remaining 20,000 - 16,000 = Rs. 4,000 will be paid by
A, B and C in 3:2:1 Ratio), Deficiency is Rs.4,000 will be shared by A, B & C in the ratio of 3:2:1.
6
= 1,333
15. (c) Debited to all partners capital A/c in the old ratio
Explanation: At the time of retirement or death of a partner, while adjusting the capital accounts, preliminary expenses
given in the balance sheet should be debited to all the partners in their old profit sharing ratio. Preliminary expenses are
deferred expenditures which are to be written off between all partners.
OR
Explanation: Partner’s capital account will be debited in case of loss on revaluation, drawings,dr balance of profit and
loss and in other cases his account will be credited i.e.
Profit on Revaluation
General Reserve etc.
16. (d) Hidden Goodwill
Total Capital of the new firm - Combined capital of all partners (including new partner capital) = Hidden Goodwill
= ₹ 14,000 × 2 = ₹ 23,000
10
18. Step 1;
Step 2;
100
10
100
Step 3;
Step 4;
(Being bank loan taken from State Bank of India @10% p.a.
interest)
Sacrifice or Gain:
X= − = (Sacrifice)
3 5 6 − 5 1
=
4 8 8 8
Y = (Gain)
1 3 2 − 3 1
− = =
4 8 8 8
8
of ₹ 1,60,000 = ₹ 20,000
8
of ₹ 1,60,000 = ₹ 20,000
JOURNAL
(Being Adjustment for goodwill due to change in profit sharing ratio is made)
21. JOURNAL
(Being the receipt of application money @ ₹ 3 per share on 1,10,000 share)
(Being the application money transferred to Equity Share Capital and excess
application money transferred to Equity Shares Allotment Account and Calls-in-
Advance Account, balance refunded)
₹ ₹ ₹
₹ ₹
I. 30,000 (10,000 ×
10,000 NIL ... ... ... 30,000
(Rejected) ₹ 3)
30,000 30,000
60,000 (20,000 ×
II. X 20,000 10,000 (10,000 × ₹ (10,000 × ₹ ... ...
₹ 3)
3) 3)
30,000
30,000 (10,000 ×
III. Y 10,000 10,000 (10,000 × ₹ .... ... ...
₹ 3)
3)
70,000
30,000
90,000 90,000
IV. (Pro- 2,10,000 (70,000 30,000 (2,10,000 -
(Bal. (Bal. (30,000 × ₹ (30,000 × ₹ ...
rata) × ₹ 3) 90,000 - 90,000)
Fig.) Fig.) 3) 3)
Dr. Cr.
Particulars ₹ Particulars ₹
To Sundry Assets: By Sundry Liabilities:
To Bank A/c (Liabilities paid off) 63,000 By Bank A/c (Sale of unrecorded asset) 15,000
Goodwill 12,000
Debtors 34,200
Plant and Machinery 90,000 1,81,200
3,12,900 3,12,900
Dr. Cr.
Particulars ₹ Particulars ₹
To Bank A/c 57,000 By Balance b/d 57,000
57,000 57,000
CAPITAL ACCOUNTS
Dr. Cr.
Particulars A B C Particulars A B C
₹ ₹ ₹ ₹ ₹ ₹
To Realisation A/c (Loss) 28,350 18,900 9,450 By Balance b/d 60,000 12,000 60,000
BANK ACCOUNTS
Dr. Cr.
Particulars ₹ Particulars ₹
To Balance b/d 10,500 By Realisation A/c (Liabilities Paid) 63,000
To Realisation A/c (Sale of unrecorded asset) 15,000 By Realisation A/c (Exp.) 2,400
2,10,600 2,10,600
Working Notes:
(6) First of all, Cr. side of Realisation A/c will be completed and the total of Cr. side ₹ 3,12,900 will be put on Dr. side
and the missing figure on Dr. side will be 'Liabilities paid' off ₹ 63,000.
(12) Cr. side of Bank A/c will be completed and the total of Cr. side ₹ 2,10,600 will be put on Dr. side and the missing
figure will be the opening balance of ₹ 10,500.
JOURNAL
60,00,000
(Application money received on 15,00,000 shares)
20,00,000
(Application & Allotment money adjusted)
40,00,000
(First call money due on 10,00,000 shares)
OR
(First call money received except on 4,000 shares and calls in advance 40,00,000
adjusted)
30,00,000
(Second & Final Call money due on 10,00,000 shares)
30,00,000
(Second and final call money received except on 4,000 shares )
36,000
(3,600 of the forfeited shares reissued as fully paid up)
10,800
(Gain on 3,600 reissued shares transferred to capital reserve A/c )
Working Notes:
i.
10,00,000
a. Applicant for 6,000 shares must have been allotted × 6,000
15.00,000
= 4,000 shares
= ₹ 8,000
20,00,000
Less :Not received on First Call 8,000
24. Journal
Dr. Cr.
Date Particulars L.F.
(₹) (₹)
2016
April Charu’s Capital A/c Dr. 9,000
1
(Adjustment for revaluation of assets and liabilities and for reserves, profits and
goodwill on change in profit sharing ratio)
BALANCE SHEET
Liabilities ₹ Assets ₹
Creditors 87,000 Cash 30,000
Profit & Loss A/c (Profits) 21,000 Less : Provision for doubtful debts 2,000 60,000
Capital Accounts: Stock 1,80,000
8,00,000 8,00,000
Workings:
(+) 81,000
Old Ratio of Brijesh, Charu and Dilip = 3: 2: 1
Brijesh = (Sacrifice)
3 4 1
− =
6 9 18
Charu = (Gain)
2 4 2
− =
6 9 18
Dilip = 1
6
−
1
9
=
1
18
(Sacrifice)
18
= ₹ 4,500 (Cr.)
18
= ₹ 4,500 (Cr.)
Amount Amount
Particulars Particulars
(Rs) (Rs)
To Workmen's Compensation Claim A/c 12,000 By Provision for Bad Debts A/c 2,000
Lokesh 20,000
Mansoor 12,000
42,000
42,000
===== ======
Lokesh
Mansoor Nihal
Lokesh
Mansoor Nihal
Particulars Amount
Amount
Amount
Particulars Amount
Amount
Amount
To Profit and Loss A/c 10,000 6,000 4,000 By Balance b/d 1,40,000 80,000 50,000
By Cash A/c(Balancing
To Mansoor's Capital A/c 21,857 8,743 4,286
Figure)
1,40,000
1,10,600
54,286
1,40,000
1,10,600
54,286
======= ====== ===== ====== ======= ======
Working Note:Whenever a partner exits a partnership, the books of accounts of such a firm have to be settled. The
outgoing partner or his legal representatives have to be paid their dues. This means a revaluation of assets and liabilities
must be done. Share of goodwill is to be calculated, and the adjusted capital after retirement is to be calculated.
Mansoor’s share of goodwill = 1,02,000 × = Rs 30,600, to be contributed by Lokesh and Nihal in gaining ratio i.e., 5 :
3
10
2
Lokesh will pay = 30,600 × = Rs 21,857; Nihal will pay = 30,600 × = Rs 8,743
5 2
7 7
26. Journal
4,32,000
(Application money received on 4,000 9% Debentures)
60,000
(6,000; 9% Debentures issued at par and redeemable at a premium of 10%)
10,50,000
(Application money received on 10,000 9%Debentures)
Debenture Application and Allotment A/c Dr. 10,50,000
50,000
(1,000; 9% Debentures issued at a premium of ₹5)
Part B :- Analysis of Financial Statements
27. (a) Expense, Outflow
Explanation: Interest paid on long term borrowings is an outflow of cash. It is shown as a deduction in financing
activities while preparing cash flow statement as long term borrowings is a financial item. it is deducted from financing
activity.
OR
Explanation: Following is the source of finance except for fixed assets, these will be shown in financing activity.
i. Bank Loan
ii. Bank Overdraft
iii. Debentures
As fixed assets is an investing activity.
OR
Explanation: These are the company's core business activities, such as manufacturing, distributing, marketing and
selling a product or service. Operating activities should generally provide the majority of a company's cash flow and
largely determine whether a company is profitable.
30. (b) To Compile National Income and taxes and policy making.
Explanation: Government is interest in financial statement analysis to compile the national income,do tax research and
to take decisions related to policies of economic interest..
Net Profit before interest and tax = Gross Profit - Office and Administrative Exp. - Selling and Distribution Exp.
Capital Employed = Non Current Assets + Current Assets - Current Liabilities or capital + reserves
= ₹ 3,25,000
65,000
Return on Capital Employed = 3,25,000
× 100 = 20%
33. Case 1:
Operating Profit
Operating Profit Ratio = × 100
Net Sales
1,50,000
=
10,00,000
× 100 = 15%
Case 2:
Operating Profit
Operating Profit Ratio = Net Sales
× 100
Case 3:
20
100
Operating Profit
Operating Profit ratio = Net Sales
× 100
54,000
=
3,60,000
× 100 = 15%
Case 4:
Operating Profit
Operating Profit Ratio = × 100
Net Sales
67,500
=
4,50,000
× 100 = 15%
Case 5:
Let Sales = x
Gross Profit =
20 20x
∴ x× =
100 100
x = 8,00,000 +
20x
100
or, 80x
100
= 8,00,000
Operating Profit
Operating Profit Ratio = Net Sales
× 100
1,50,000
=
10,00,000
× 100 = 15%
OR
Revenue from Operations = Cash Revenue from Operations + Credit Revenue from Operations
100
)
Average Inventory
₹2,80,000
2 =
Average Inventory
₹2,80,000
Average Inventory = 2
= ₹ 1,40,000.
∴ Opening Inventory = of x or
1 x
3 3
Opening Inventory + Closing Inventory
Average Inventory = 2
₹1,40,000 = 3
₹1,40,000 × 2 = x
3
+ x
₹2,80,000 = 4x
4x = ₹ 2,80,000 × 3 = ₹ 8,40,000
₹8,40,000
x= 4
= ₹ 2,10,000 (Closing Inventory).
₹2,10,000
∴ Opening Inventory = 3
= 70,000.
Case 2: If Closing Inventory is 25% less than the Inventory in the beginning.
x+0.75x
1,40,000 = 2
2,80,000 = 1.75x
₹2,80,000
x =
1.75
= 1,60,000 (Opening Inventory).
Particulars ₹ ₹
A. Cash Flow from Operating Activities
Items to be Added:
Inventories (56,000)
Add: Cash and Cash Equivalent in the beginning of the period 70,000