Problem 1.

From the data calculate:

(i) Gross Profit Ratio
(ii) Net Profit Ratio
(iii) Return on Total Assets
(iv) Inventory Turnover
(v) Working Capital Turnover
(vi) Net worth to Debt

Sales 2,520,000 Other Current Assets

Cost of sales 1,920,000 Fixed Assets
Net profit 360,000 Inventory
Net worth
Debt
Current Liabilities

Problem 2. Perfect Ltd. gives the following Balance sheet. You are required to compute the following ratios.
(a) Liquid Ratio
(b) Solvency Ratio
(c) Debt-Equity Ratio

Equity share capital 1,500,000 Fixed Assets

Reserve fund 100,000 Inventory
6% Debentures 300,000 Debtors
Overdraft 100,000 Cash
Creditors 200,000

2,200,000

Problem 3. Calculate the following ratios from the balance sheet given below :
(i) Debt – Equity Ratio
(ii) Liquidity Ratio
(iii) Fixed Assets to Current Assets
(iv) Fixed Assets Turnover

Liabilities: Assets:
Equity shares of $ 10 each 100,000 Goodwill
Reserves 20,000 Fixed Assets
P.L. A/c 30,000 Inventory
Secured loan 80,000 Sundry Debtors
 Sundry creditors 50,000 Advances
Provision for taxation 20,000 Cash balance
300,000

The sales for the year were $ 5,60,000.

Problem 4. The Balance sheet of Naronath & Co. as on 31.12.2020 shows as follows:
Comment on the financial position of the Company i. e., Debt – Equity Ratio, Fixed Assets Ratio, Curren

Liabilities: Assets:
Equity capital 100,000 Fixed Assets
15% Preference shares 50,000 Stores
12% Debentures 50,000 Debtors
Retained Earnings 20,000 Bills Receivable
Creditors 45,000 Bank

265,000

Problem 5. From the following particulars pertaining to Assets and Liabilities of a company calculate
(a) Current Ratio
(b) Liquidity Ratio
(c) Debt-equity Ratio
(d) Capital Gearing Ratio

Liabilities: Assets:
50,000 equity shares $ 10
each 500,000 Land & Building
8% 2000 Preference shares @$100 200,000 Plant & Machinery
9% 4000 Debentures of $ 100 each 400,000 Debtors
Reserves 300,000 Inventory
Creditors 150,000 Cash and Bank
Unearned revenue 100,000 Prepaid expenses
Bank overdraft

1,650,000
Problem 6. From the following details of a trader you are required to calculate
(i) Purchase for the year
(ii) Rate of Inventory turnover
(iii) Percentage of Gross profit to turnover

Sales 33,984
Inventory at the close at cost price 1,814
Sales Returns 380
G.P. for the year 8,068
Inventory at the beginning at cost price 1,378

Problem 7. Calculate Inventory turnover ratio from the following information

Opening Inventory 58,000

Purchases 484,000
Sales 640,000
Gross Profit Rate 25% of sales

Problem 8. Calculate the operating Ratio from the following figures

Sales 17,874
Sales Returns 4
Other Incomes 53
Cost of Sales 15,440
Administration and Selling Exp 1,843
Depreciation 63
Interest Expenses 456
 760,000
1,440,000
800,000
1,500,000
900,000
600,000

ute the following ratios.

1,400,000
500,000
200,000
100,000

2,200,000

60,000
140,000
30,000
30,000
 20,000
20,000
300,000

o, Fixed Assets Ratio, Current Ratio, and Liquidity.

180,000
25,000
55,000
3,000
2,000

265,000

mpany calculate

500,000
600,000
200,000
240,000
55,000
5,000
50,000

1,650,000