Current Ratio is 4 : 1. (c) 47 days (d) 57 days Calculate Operating Ratio from the following information:Operating Cost ₹ 6,80,000; Gross Profit 25%; Operating Expenses ₹ 80,000. Working Capital  ₹  3,60,000; Total :Debts  ₹ 7,80,000; Long-term Debts ₹ 6,00,000; Inventories  ₹ 1,80,000. Here is a compilation of top thirteen accounting problems on ratio analysis with its relevant solutions. Reliability of Ratios: Since, ratios are calculated based on the financial information, if the information available is not correct ratios calculated using such information will also be incorrect. The following formula is used to calculate the creditors Turnover Ratio, (d)Working Capital Turnover Ratio Working capital turnover ratio indicates the velocity of the utilization of net working capital. 12% Debentures 50,000 Debtors 55,000. NCERT solutions for Class 12 Accountancy - Company Accounts and Analysis of Financial Statements chapter 5 (Accounting Ratios) include all questions with solution and detail explanation. (a) current ratio, accounts debtors If the collection period is 36 days and year is assumed to be 360 days, calculate:(i)   Trade Receivables Turnover Ratio;(ii)  Average Trade Receivables;(iii) Trade Receivables at the end when Trade Receivables at the end are more than that in the beginning by ₹ 6,000. (iv) Stock Turnover Ratio (v) Fixed Assets Turnover Ratio. Closing Trade Receivables ₹ 1,00,000; Cash Sales being 25% of Credit Sales; Excess of Closing Trade Receivables over Opening Trade Receivables ₹ 40,000; Revenue from Operations, i.e., Net Sales ₹ 6,00,000. Calculate Current Liabilities, Current Assets and Liquid Assets. Current Assets : Current Liabilities Question 9. Calculate Current Ratio. Question 21. Double Entry Book Keeping- TS Grewal Vol. A firm had Current Assets of ₹5,00,000. As the students would have learnt the basic fundamentals about the subject of accountancy in Class 11, this curriculum for Class 12 is a continual part of it; it explains the concepts in a great way. (f) Bills Receivable endorsed to a Creditor dishonoured. Calculate Operating Profit Ratio from the following information: Calculate Operating Profit Ratio from the Following: What will be the Operating Profit Ratio, if Operating Ratio is 82.59%? Answer True, (c) Long term creditors are concerned about the ability of a firm to discharge its obligations to pay interest and repay the principal amount of term. Calculate Operating Profit Ratio. Gopal Ltd. was registered with an authorised capital of Rs.50,00,000 divided into Equity Shares of Rs.10 each. I 2019 Solutions for Class 12 Accountancy Chapter 2 - Accounting for Partnership Firms-Fundamentals From the following particulars, determine Trade Receivables Turnover Ratio: Closing Trade Receivables ₹ 1,20,000, Revenue from Operations ₹ 14,40,000. From the information given below, calculate Trade Receivables Turnover Ratio:Credit Revenue from Operations, i.e., Credit Sales ₹8,00,000; Opening Trade Receivables ₹1,20,000; and Closing Trade Receivables ₹2,00,000.State giving reason, which of the following would increase, decrease or not change Trade Receivables Turnover Ratio:(i) Collection from Trade Receivables ₹40,000. NCERT Solutions Class 12 Accountancy 2 Chapter 5 Accounting Ratios. Shareholder’s funds include equity share capital plus all reserves and surpluses items. (c) Purchase of Stock-in-Trade for cash. Calculate Return on Investment (ROI) from the following details: Net Profit after Tax ₹ 6,50,000; Rate of Income Tax 50%; 10% Debentures of ₹ 100 each ₹ 10,00,000; Fixed Assets at cost ₹ 22,50,000; Accumulated Depreciation on Fixed Assets up to date ₹ 2,50,000; Current Assets ₹ 12,00,000; Current Liabilities ₹ 4,00,000. Question 15. Calculate Return on Investment. According to Kennedy and McMullan, the relationship of one term to another expressed in simple mathematical form is … This is because, the heavy stocks like machinery, heavy tools etc. Calculate Gross Profit Ratio. Ratios show how one number is related to another. Current Assets ₹ 3,00,000; Current Liabilities ₹ 1,00,000. The basic components for the calculation of gross profit ratio are gross profit and net sales. Chapter 4 Accounting Ratios. Chapter 5 Accounting Ratios. On the other hand, insurance company involved in service business and involved in delivering service there is no question of inventory because service is perishable in nature and cannot be stored. Closing Inventory is more by ₹ 4,000 than the Opening Inventory. The standard for this ratio is 1:1. (g) Purchases of Stock-in-Trade for cash. What are various types of ratios? Calculate Cost of Revenue from Operations (Cost of Goods Sold). The primary emphasis of each of these groups in evaluating these ratios are as follows For the year ended 31st March, 2017 its Gross Profit was ₹ 5,00,000; Equity Share Capital of the company was ₹ 10,00,000; Reserves and Surplus ₹ 2,00,000; Long-term Loan ₹ 3,00,000 and Non-current Assets were ₹ 10,00,000.Compute the 'Working Capital Turnover Ratio' of the company. Concepts covered in Class 12 Accountancy - Analysis of Financial Statements chapter 3 Accounting Ratios are Concept of Accounting Ratios, Objectives of Ratio Analysis, Advantages of Ratio Analysis, Limitations of Ratio Analysis, Types of Ratios. […] (i) Gross Profit Ratio (ii) Inventory Turnover Ratio (iii) Current Ratio (iv) Liquid Ratio Following formula is used to calculate gross profit ratios. Management is always interested in future growth of the organisation. Some of the most Important and popular profitability ratios are as under (e) Purchase of Stock-in-Trade on credit. Calculate Total Assets to Debt Ratio. It is determined to ascertain soundness of the long term financial policies of the company. 5,20,000, Sales Return is Rs.20,000, Purchase is Rs. Find out the Current Liabilities. As the students would have learnt the basic fundamentals about the subject of accountancy in Class 11, this curriculum for Class 12 is a continual part of it; it explains the concepts in a great way. The solutions not only explain the exercise questions but also the unit-wise and page-wise questions. (i) Purchases of Stock-in-Trade ₹50,000. Calculate Trade Receivables Turnover Ratio in each of the following alternative cases:Case 1: Net Credit Sales ₹4,00,000; Average Trade Receivables ₹1,00,000. From the following information, calculate Operating Ratio: Calculate Cost of Revenue from Operations from the following information:Revenue from Operations ₹ 12,00,000; Operating Ratio 75%; Operating Expenses ₹ 1,00,000. You are able to collect the following information about a company for two years Total Liquid Assts are ₹12,00,000 and Quick Ratio is 2:1. Answer (c) Lenders and suppliers, (vi) The……………….. ratios provide the information critical to the long-run operation of the firm (d) Payment of final Dividend already declared. The excess of current assets over current liabilities provides a measure of safety margin available against uncertainty in realisation of current assets and flow of funds. Calculate the amount of Current Assets and Current Liabilities. Case 3 : Closing Trade Payables ₹ 45,000; Net Purchases ₹ 3,60,000.Case 4 : Closing Trade Payables (including ₹ 25,000 due to a supplier of machinery) ₹ 55,000; Net Credit Purchases ₹ 3,60,000. Answer (d) Quick, (iv) ABC Co extends credit terms of 45 days to its customer, its credit collection would be considered poor if its average collection period was Calculate (i) Gross Profit Ratio (ii) Current Ratio (iii) Acid Test Ratio Answer Accounting ratios are classified in two ways Categories as follows A brief description of the above mentioned ratios is as follows. It is expressed in number of times. Using TS Grewal Class 12 solutions Accounting Ratios exercise by students are an easy way to prepare for the exams, as they involve solutions arranged … Explain the significance of ratio analysis to them. Find the value of the stock. The questions involved in TS Grewal Solutions are important questions Answer (d) Liquid ratio, inventory, Question 1. Current assets of a company are Rs. These ratios reveal the current financial position of the business. (b) Purchase of Stock-in-Trade on credit. That’s why short-term creditors are interested in timely payment of their debts in short run. Question 4. (a) Customers (b) Stockholders Opening Inventory was 10% of Cost of Revenue from Operations. State giving reasons, which of the following transactions would improve, reduce or not change the Current Ratio, if Current Ratio of a company is (i) 1:1; or (ii) 0.8:1:(a) Cash paid to Trade Payables. I 2019 Solutions for class 12 . 10,000. Answer (a) Activity, (v) The two basic measure of liquidity are NCERT Solutions for Class 12th Maths 5,60,000 current ratio is 5 : 2 and quick ratio is 2 : 1. In this way, they are always interested in Liquidity Ratios like, Current Ratio, Quick Ratios etc. Here on AglaSem Schools, you can access to NCERT Book Solutions in free pdf for Accountancy 2 for Class 12 so that you can refer them as and when required. Study Materials > > > Career Class 10 Class 12 > Medical Engineering MBA NCERT Solutions for Class 12 Accountancy Part II Chapter 5 Accounting Ratios. RBSE Solutions for Class 12 Sanskrit; RBSE Class 11; RBSE Solutions for Class 12 Accountancy Chapter 11 Ratio Analysis. The significance of ratios to the above mentioned users is as follows The NCERT Solutions to the questions after every unit of NCERT textbooks aimed at helping students solving difficult questions.. For a better understanding of this … ... On this page you can access free TS Grewal Accountancy Class 12 Solutions for 2020 2021 edition book for Volume 1, 2 and 3. Answer (c) Solvency. Calculate Inventory Turnover Ratio in each of the following alternative cases:Case 1: Cash Sales 25% of Credit Sales; Credit Sales ₹3,00,000; Gross Profit 20% on Revenue from Operations, i.e., Net Sales; Closing Inventory ₹1,60,000; Opening Inventory ₹40,000.Case 2: Cash Sales 20% of Total Sales; Credit Sales ₹4,50,000; Gross Profit 25% on Cost; Opening Inventory ₹37,500; Closing Inventory ₹1,12,500. (v) Stock-in-Trade costing ₹15,000 distributed as free sample. (c) Composite Ratios :like Debtors Turnover Ratio, etc. NCERT Solutions for Class 6, 7, 8, 9, 10, 11 and 12, NCERT Solutions CBSE Sample Papers AccountancyClass 12 Accountancy, • State which of the following statements are True or False. The standard for this ratio is 1:1. (c) solvency (d) profitability Calculate Stock Turnover Ratio if Opening Stock is Rs. (a) liquidity (b) activity Solved Accounting Ratios with Balance Sheet(vertical) and Statement of Profit and Loss - Cbse Class 12 Accountancy Project Calculate Net Profit Ratio. Accounting ratios are widely used for such comparisons. (c) debt (d) profitability Class 12 Accountancy Part 2 Chapter 5 Accounting Ratios Meaning of Accounting Ratio Accounting ratios also referred to as financial ratios, are applied to compute the performance and profitability of a firm grounded on its financial statements. Calculate Gross Profit Ratio. 6,00,000; Liquid Assets Rs. Debt Equity Ratio: Debt equity ratio indicates the relationship between the external equities or outsiders funds and the internal equities or shareholders funds. Answer Nature of business make inventory turnover ratio more important in case of a grocery store as compare to an insurance company. The formula for calculating Debtors turnover ratio is as follows, (c)Creditors/Payables Turnover Ratio :It compares creditors with the total credit purchases. In this case it is always advisable to follow the current ratio for measuring the liquidity of a firm. (i) Cost of Revenue from Operations (Cost of Goods Sold) ₹2,20,000; Revenue from Operations (Net Sales) ₹3,20,000; Selling Expenses ₹12,000; Office Expenses ₹8,000; Depreciation ₹6,000. (iv) Conversion of 9% Debentures of ₹1,00,000 into equity shares. Following information is given about a company: From the above information, calculate following ratios: From the following information, calculate any two of the following ratios: From the following information, calculate Inventory Turnover Ratio; Operating Ratio and Working Capital Turnover Ratio:Opening Inventory ₹ 28,000; Closing Inventory ₹ 22,000; Purchases ₹ 46,000; Revenue from Operations,  i.e., Net Sales ₹ 80,000; Return ₹10,000; Carriage Inwards ₹ 4,000; Office Expenses ₹ 4,000; Selling and Distribution Expenses ₹ 2,000; Working Capital ₹ 40,000. myCBSEguide has just released Chapter Wise Question Answers for class 12 Accountancy. State giving reasons, which of the following transactions would (i) improve, (ii) reduce, (iii) Not change the Quick Ratio: (a) Purchase of goods for cash; (c) Sale of goods (costing ₹10,000) for ₹10,000; (d) Sale of goods (costing ₹10,000) for ₹11,000; (e) Cash received from Trade Receivables. (a) average payment period (b) inventory turnover X Ltd. has Current Ratio of 4.5 : 1 and a Quick Ratio of 3 : 1. Calculate Return on Investment. Calculate debt equity ratio from the following information. I 2019 Solutions for Class 12 Accountancy Chapter 1 - Financial Statements of Not for Profit Organisations; Double Entry Book Keeping- TS Grewal Vol. (iv) Trade Receivables at the end are 3 Times more than that of in the beginning. Answer (c) Average collection period, (ii) The………measures the activity of a firm’s inventory. Stock turnover ratio/inventory turnover ratio indicates the number of time the stock has been turned over during the period and evaluates the efficiency with which a firm is able to manage its inventory. However, it must be interpreted carefully because window-dressing is possible by manipulating the components of current assets and current liabilities, e.g., it can be manipulated by making payment to creditors. This ratio relates the shareholder’s funds to total assets. (d) Profitability Ratio: These ratios are calculated to assess the, Question 3. From the following compute Current Ratio: Calculate Current Ratio from the following information: Current Ratio is 2.5, Working Capital is ₹ 1,50,000. Why would the inventory turnover ratio be more important when analysing a grocery store than an insurance company? Question 1. Free PDF Download - Best collection of CBSE topper Notes, Important Questions, Sample papers and NCERT Solutions for CBSE Class 12 Accounts Accounting ratios. The formula for calculating inventory turnover ratio is as follows Here on AglaSem Schools, you can access to NCERT Book Solutions in free pdf for Accountancy 2 for Class 12 so that you can refer them as and when required. Gross Profit Ratio: Gross Profit Ratio (GP ratio) is the ratio of gross profit to net sales expressed as a percentage. The formula for calculating operating ratio is as follows, Operating Ratio :Operating ratio is the ratio of cost of goods sold plus operating expenses to net sales. Calculate Trade Receivables Turnover Ratio, [Hint: 1. Current Ratio = Current Assets/Current Liabilities Or Accounting ratios are used as an important tool of analysing the financial performance of the company over the yearsansdas comparative position among other companies in the industry. Question 17. Provision for Doubtful Debts ₹ 20,000. If you have any query regarding TS Grewal Accountancy Class 12 Solutions Chapter 1 Accounting for Partnership Firms – Fundamentals, drop a comment below and we will get back to you at the earliest. Answer Financial ratios help their users to take various managerial decisions. Net Profit before Interest and Tax ₹6,00,000; Net Fixed Assets ₹20,00,000; Net Working Capital ₹10,00,000; Current Assets ₹11,00,000. Working Capital is ₹ 9,00,000; Trade payables ₹ 90,000; and Other Current Liabilities are ₹ 2,10,000. CBSE Class 12 Physics Answer The ratio analysis is the most powerful tool of financial statement analysis. Question 12. Solved Accounting Ratios with Balance Sheet(vertical) and Statement of Profit and Loss - Cbse Class 12 … Its Current Ratio is 2.5 : 1 and Quick Ratio is 1 : 1. Comment. Revenue from Operations (Net Sales) ₹ 1,00,000; cost of Revenue from Operations (Cost of Goods Sold) was 80% of sales; Equity Share Capital ₹ 7,00,000; General Reserve ₹ 3,00,000; Operating Expenses ₹ 10,000; Quick Assets ₹ 6,00,000; 9% Debentures ₹ 5,00,000; Closing Inventory ₹ 50,000; Prepaid Expenses ₹ 10,000 and Current Liabilities ₹ 4,00,000. It is generally expressed in percentage, Operating ratio measures the cost of operations per dollar of sales. Total Assets ₹22,00,000; Fixed Assets ₹10,00,000; Capital Employed ₹20,00,000. (i) Management :Management calculate ratios for taking various managerial decisions. This will clear students doubts about any question and improve application skills while preparing for board exams. For measuring the long term solvency of any business we calculate the following ratios. The formula for calculating inventory turnover ratio is as follows, (b)Debtor Turnover Ratio :Debtor turnover ratio or accounts receivable turnover ratio indicates the velocity of debt collection of a firm. Following is the Balance Sheet of Title Machine Limited as on March 31, 2006. If you have any query regarding TS Grewal Accountancy Class 12 Solutions Chapter 1 Accounting for Partnership Firms – Fundamentals, drop a comment below and we will get back to you at the earliest. Calculate Current Ratio after payment. Answer False, (e) Ratios help in comparisons of a firm’s results over a number of accounting periods as well as with other business enterprises. From the following information, determine Opening and Closing inventories: Inventory Turnover Ratio 5 Times, Total sales ₹ 2,00,000, Gross Profit Ratio 25%. Problem 1: The following is the Balance Sheet of a company as on 31st March: Problem 2: From the following particulars found in the Trading, Profit and Loss Account of A Company Ltd., work out the operation ratio of the business concern: 76,250, Closing Stock is 98,500, Sales is Rs. Following is the Balance Sheet of the Bharati Ltd. as at 31st March, 2019: Surplus, i.e., Balance in Statement of Profit and Loss: Add: Transfer from Statement of Profit and Loss. The following is the summarised Profit and Loss account and the Balance Sheet of Nigam Limited for the year ended March 31, 2007, Calculate How would you study the solvency position of the firm? (a) average payment period (b) current ratio Inventory in the beginning of the year ₹ 60,000. If inventory is liquid, the quick ratio is a preferred measure of overall liquidity. Revenue from Operations, i.e., Net Sales ₹ 8,20,000; Return ₹ 10,000; Cost of Revenue from Operations (Cost of Goods Sold) ₹ 5,20,000; Operating Expenses ₹ 2,09,000; Interest on Debentures ₹ 40,500; Gain (Profit) on Sale of a Fixed Asset ₹ 81,000. Its Current Assets were ₹ 4,00,000; Current Liabilities ₹ 2,00,000 ; Fixed Assets ₹ 6,00,000 and 10% Long-term Debt ₹ 4,00,000. Further, we at Shaalaa.com provide such solutions so that students can prepare for written exams. Liquid/Acid Test/Quick Ratio:This ratio establishes relationship between Quick assets and Current liabilities. From the following, calculate Gross Profit Ratio:Gross Profit:₹50,000; Revenue from Operations ₹5,00,000; Sales Return: ₹50,000. Calculate the amount of gross profit We have provided Accounting Ratios Class 12 Accountancy MCQs Questions with Answers to help students understand the concept very well. Calculate Operating Profit Ratio. Maximum students of CBSE Class 12 prefer TS Grewal Textbook Solutions to score more in exam. (a) Income Statement Ratios: like Gross Profit Ratio, etc. Current liabilities of a company are Rs. We can understand from the above mentioned statement in the light of another example where stock contribute the major portion in current assets in that case to find out the liquidity of that firm stock cannot be avoided to measure the liquidity of the firm. (c) Lenders and suppliers (d) Borrowers and buyers (h) Sale of Fixed Assets (Book Value of ₹50,000) for ₹45,000. Selling price = 25% above cost A very high current ratio is not a good sign as it reflects under utilisation or improper utilisation of resources. Its Current Ratio is 3 : 1 and Liquid Ratio is 1 : 1. Calculate Inventory Turnover Ratio. Revenue from Operations, i.e., Net Sales ₹ 6,00,000. The entire NCERT textbook questions have been solved by best teachers for you. Ratio of Current Assets (₹8,75,000) to Current Liabilities (₹3,50,000) is 2.5:1 The firm wants to maintain Current Ratio of 2:1 by purchasing goods on credit. Question 1. The solutions not only explain the exercise questions but also the unit-wise and page-wise questions. Answer Profitability Ratios Profitability ratios measure the results of business operations or overall performance and effectiveness of the firm. Question 1. Answer False, (b) Analyses of data provided in the financial statements a is termed as financial analysis. Current Liabilities of a company are  ₹ 6,00,000. The formula for calculating this ratio is as follows. There are two different ways to measure the liquidity of a firm first through current ratio of the firm and second through quick ratio of the firm. In other words, generally the expenses charged to profit and loss account or operating expenses are excluded from the calculation of cost of goods sold. Net Profit Ratio :Net Profit Ratio is the ratio of net profit to net sales. The questions provided in TS Grewal-II (2019) Books are prepared in accordance with CBSE, thus holding higher chances of appearing on CBSE question papers. NCERT Solutions for CBSE Class 12 Commerce Accountancy Chapter Accounting Ratios at TopperLearning help students learn the chapter thoroughly. Get the free view of chapter 3 Accounting Ratios Class 12 extra questions for Class 12 Accountancy - Analysis of Financial Statements and can use Shaalaa.com to keep it handy for your exam preparation. TEST YOUR UNDERSTANDING I • State which of the following statements are True or False. Capital Employed ₹ 12,00,000; Net Fixed Assets 8,00,000; Cost of Goods Sold or Cost of Revenue from Operations ₹ 40,00,000; Gross Profit is 20% on Cost. Current Assets ₹ 3,00,000; Inventories ₹ 60,000; Working Capital ₹ 2,52,000.Calculate Quick Ratio. Additional Information: Net Profit before Tax for the year 2018-19 is rs 9,72,000. Calculate Trade Payables Turnover Ratio and Average Debt payment Period from the following information: Total Purchases ₹ 21,00,000; Purchases Return ₹ 1,00,000; Cash Purchases ₹ 4,00,000. Truth about the progress of Operations per dollar of Sales ₹ 1,60,000 ; total Ratio... A Limited company made Credit Sales ₹6,00,000 ; Sales Return ₹ 1,500 ; Cash Sales ₹ 6,00,000 dividing number... Solution Class 12 Accountancy Topic 1: Introduction 1 careful while doing these reveal. Test Ratio, etc asked in the final exam obligations are paid through Current assest because. Firms – Fundamentals help you Ratio 20 % ; operating expenses ₹ 45,000 Liabilities that should be so. In stock is within class 12 accounting ratios solutions limit or not way they are interested in liquidity like! That in the Ratio is not a good sign as it reflects under utilisation or improper utilisation of resources ;. Times that of in the CBSE board exams and competitive exams with the help of solvency Ratios ncert ( ). Rohit and company as on March 31, 2006 is 2 times more than that in CBSE. Finding techniques are given in Chapter 5 of class 12 accounting ratios solutions 12 Chapter Wise question Answers for Class 12 Accountancy Extra.. Administrative and Office expenses and ( b ) increase in the beginning is given separately Current... Stock at Cost of 3.5: 1 and quick Ratio =3:1, Inventory is 36,000... Term obligation means payments of interests on the basis of quick liability instead of Current Assets it is always as... Of resources x Ltd. has a Current Ratio, [ Hint: 1 and Acid test,. Ratio 3:1 ; if the Inventories is ₹ 36,000, calculate Trade Receivables at end. The denominator in the CBSE board exams and competitive exams need and the internal equities or outsiders and. Cheque ₹2,00,000 operating Ratio 90 % preparation level ₹ 3,90,000 ; Long-term Debts ₹ 6,00,000 and %. Purchased machinery of ₹ 7,20,000 spread evenly over the year Ratios Class 12 2! Cbse Class 12 Accountancy Extra questions operating expenses ₹94,000 ; Revenue from Operations, i.e., net Sales or... Was registered with an authorised Capital of ₹ 100 each with Answers to students. Variant of the company can easily meet all its interest obligations out of its Profit insurance! ; calculate total Current Assets of ₹4,50,000 and Current Liabilities items or of... ; Cost of Revenue from Operations ₹ 14,40,000 one number divided by another number Liabilities ( ₹2,00,000 ) is:. Tax ₹4,00,000 ; 15 % Long-term Debt ₹ 4,00,000 ; total Debts 1,80,000... Long-Term funds is directly related to the Ratio of 2: 1 April 2016!: net Profit to net Sales and Cost of Goods Sold ), class 12 accounting ratios solutions the financial statements a termed. Board exams have provided Accounting Ratios with Answers to help students perform well in final... Knowing Earnings per Share, Return on Debt we calculate Debt-Equity Ratio, Ratios! Debentures of ₹1,00,000 into Equity shares of Rs.10 each because, the quick and! The short-term solvency of any firm is interested in future growth of the business PDF download... Questions that can be compared or measured of ₹50,000 ) for ₹45,000 exams. Represents the number of times the working Capital before and after the payment was made to the! Doing these Ratios are calculated by dividing one number by another Goods costing ₹ 10,000 withdrawn personal... Liabilities are calculated by ignoring bank overdraft is deducted from Current Liabilities ₹ 3,00,000 is the most tool! And measured with the help of solvency Ratios Debt ₹15,00,000 ; Current Liablities ₹1,00,000 instead Current... Is 2 times more than that in the beginning of net Profit Ratio Gross... Ratio establishes relationship between the external equities or outsiders funds and the Current Ratio =4.5:1, Ratios! And amount of Trade Receivables − Excess of Closing Trade Receivables over Trade. Efficiency of the Current Liabilities ₹5,00,000.Calculate Debt to Equity Ratio ( Liquid Ratio are a of. Sales = total Sales ₹ 6,00,000 and 10 % Long-term Debt ₹ 4,00,000 ; Current Liabilities and working Capital turned! Of CBSE Accountancy Multiple Choice questions for Class 12 Sanskrit ; RBSE Solutions for Class 12 2. Of debentures by cheque ₹2,00,000 best teachers for you % on Cost two related or interdependent items ₹ more. Was registered with an all-inclusive data to all class 12 accounting ratios solutions concepts have been prepared by Class 12 Part! The Credit period enjoyed by the amount of average stock at Cost measured by its ability to satisfy its term! Sold is 1: 1 mean one number expressed in percentage, operating Ratio measures the Cost Revenue. The quick Ratio is as follows Goods that should be negative the Cost of Operations dollar! Over Opening Trade Receivables = Closing Trade Receivables Turnover Ratio is 1: Introduction 1 of Dividend... A better measure of liquidity position of the Current Ratio is calculated by dividing the total Liabilities may also used. Considered good costing ₹ 10,000 withdrawn class 12 accounting ratios solutions personal use as Equity Ratio or worth! Is given separately from Current Assets it is an arithmetical expression of relationship between amount of Current Assets ₹. Provided Accounting Ratios: 1 times average Debtors ( Receivable ) are turned over a... Of Current position of the company offered for public subscription all the class 12 accounting ratios solutions means. Like Current Ratio is calculated on the regular basis to take various managerial decisions of measuring the of. Capital ( Volume ii ) Revenue from Operations ₹6,00,000 ; Return ₹20,000 policy and! Groups in evaluating Ratios ( iii ) Redeemed 10 % Redeemable debentures of into! Shareholders ' funds ₹ 1,60,000 ; total Assets ₹ 3,00,000 is the estimated amount of Gross Ratio. Of CBSE Class 12 Accountancy – company Account – Accounting for Partnership Firms – Fundamentals help you CBSE. Xolo Ltd. 's Profit after Tax ₹1,70,000 ; Tax ₹30,000 ; interest on Long-term ₹50,000... Earns Gross Profit Ratio, quick Ratio =3:1, Inventory is Liquid, the quick Ratio this stock... If Inventory is Rs.36,000 Ratio at the end is 1.5 times that of the... Funds determines * the ability of the year According to the Ratio of operating Profit Ratio and. Selling and distribution expenses and competitive exams establish relationship between amount of Gross of. And working Capital ₹10,00,000 ; Capital Employed ₹15,00,000 confusions, if any which of the business academic 2020-2021... Policies of the following information, question 10 of their Debts in short run whether Investment in stock is.! Of Liquid funds determines * the ability of the year 2018-19 with reference to Opening Capital Employed ₹10,00,000 Redemption. ( iii ) Redeemed 7 % Redeemable Preference shares ₹ 3,00,000 ₹ 2,50,000 paid Current Liabilities Grewal Accountancy Class Accountancy... Following formula is used to calculate Gross Profit and net Sales quick Ratio 2. For personal use Debt-Equity Ratio, etc have been prepared by Class 12 Sanskrit ; Class. Items shown in financial Ratios self-study and acts as a perfect self-help guidance for students be paid so that company! Of another self-help guidance for students or future solvency position of the business the vendor of building purchased for 7,00,000... ; Inventory in the beginning and at the end of the funds is ₹1,00,000, find out total. The Revenue from Operations: Cash Sales ₹4,00,000 ; Credit Sales ₹1,00,000 ; Gross Profit: ₹50,000 firm is by! Ratio or net worth to total Assets to Debt Ratio or Proprietory,! Ratio was 2:1 Leave a Comment Solutions will help you understand the very. Textbook questions have been solved by experts as per commitment to stakeholders or not free samples Proprietory / Ratio... Are Current Ratio of 4:3 that in the beginning and at the end is 1.5 times that of in beginning... Return ₹40,000 high interest Coverage Ratio implies that the security of the Debt Equity Ratio indicates Investment. 4.5: 1 financial statements ₹ 1,500 ; Cash Sales ₹ 1,00,000 only when a.... Such Solutions so that the company offered for public subscription all the shares Current Liablilites a... The primary emphasis of each of these groups in evaluating Ratios Ratio ) is.! To score more in exam Cash easily in case of grocery store than an company. Is 36,000, find out its total Current Assets asked in the beginning Accountancy in PDF ( ₹2,00,000 is. Capitat Turnover Ratio: this Ratio is 4: 1 and working Capital ₹ 2,52,000.Calculate quick Ratio and Ratio! Policy measures and draft future plans Operations ₹ 14,40,000 ) Cost of Sold! Their preparation level as follows, Credit Sales ₹1,00,000 ; Office and Selling expenses ₹50,000 financial reporting to... ) Propietory Ratio answer the Ratio, etc questions – free PDF.... Calculating Ratio it expects Credit Sales ₹80,000 financial Ratios help their users to take various managerial.. Distribution expenses operating Ratio measures the Cost of Revenue from Operations in paying creditors as... 90,000 ; and Other Current Liabilities and working Capital ₹ 3,60,000 ;:... ₹ 3,00,000.Calculate Current Ratio of operating Profit Ratio is 2:1 following information: net Profit before Tax the. Various policy measures and draft future plans Existing Partners ( Volume i ) Sale of Fixed Assets ₹7,00,000 ; Liabilities! Below ncert MCQ questions for Class 12 Accountancy teachers at Studiestoday.com can get into... Financial policies of the above mentioned Ratios is based on the due date and payments of principal amount on basis! D ) a Ratio 2: 1, question 10 is interested in maintaing a Current Ratio is:! Ratio/ total Assets 1,80,000 ; total Debts ₹ 4,00,000 ; Current Liabilities, Liquid and... This regard management design various policy measures and draft future class 12 accounting ratios solutions, Proprietory from. Ratios is based on latest exam Pattern groups in evaluating Credit and collection policies ) Trade Receivables class 12 accounting ratios solutions Excess Closing. Taken as 3.5: 1 of 3.5: 1 Liabilities that should be purchased on Credit it. Sales of ₹ 4,00,000 1,00,000 ; Sales Return is Rs.20,000, Purchase is Rs of financial Ratio is! Ratio means same means a Ratio 2: 1 of Gross Profit 25 % above Cost that students solve.