# 12th | Ts grewal 2021-2022 Question 106 to 110 | ch:4 Accounting Ratios

#### From the following information, calculate Working Capital Turnover Ratio:

Cost of Revenue from Operations (Cost of Goods Sold) `5,00,000

Current Assets `2,50,000

Current Liabilities `1,50,000

 Working Capital = Current Assets + Current Liabilities = 2,50,000 + 1,50,000 = 1,00,000 Working Capital Turnover Ratio = Cost of Revenue from Operations/ Working Capital = 5,00,000/1,00,000 = 5 Times

#### Question 107:

Revenue from Operations: Cash Sales  ` 5,00,000; Credit Sales  ` 6,00,000; Sales Return  ` 1,00,000. Current Assets  ` 3,00,000; Current Liabilities  ` 1,00,000. Calculate Working Capital Turnover Ratio.

Net Sales = Cash Sales + Credit Sales − Sales Returns

= 5,00,000 + 6,00,000 − 1,00,000 = 10,00,000

Working Capital= Current Assets - Current Liabilities

Working Capital Turnover=  Net sales/ Working Capital

=10,00,000/2,00,000

= 5 Times

#### Question 108:

Equity Share Capital  ` 15,00,000; Gross Profit on Revenue from Operations, i.e., Net Sales 33 1/3% ; Cost Revenue from Operations or Cost of Goods Sold  ` 20,00,000; Current Assets  ` 10,00,000; Current Liabilities  ` 2,50,000. Calculate Working Capital Turnover Ratio.

Net Sales = Cost of Goods sold + Gross Profit
Net Sales =20,00,000+1/3 of Net Sales
Let Net Sales =  x
x=20,00,000+ x/3

Net sales (x)= 60,00,000/2=30,00,000

Working Capital= Current Assets - Current Liabilities

=10,00,000-2,50,000

=7,50,000

Working Capital Turnover=  Net sales/ Working Capital

=30,00,000/7,50,000

= 4 Times

#### Question 109:

Gross Profit at 25% on cost; Gross profit  ` 5,00,000; Equity Share Capital  ` 10,00,000; Reserves and Surplus  2,00,000; Long-term Loan  3,00,000; Fixed Assets (Net)  ` 10,00,000. Calculate Working  Capital Turnover Ratio

Gross Profit = 25% on Cost
Let Cost be =
` x
Gross Profit =x×25/100=25x/100

Or, 5,00,000=25x/100

Or, x=5,00,000×100/25=20,00,000
Cost of Goods Sold = 20,00,000

Net sales =Cost of goods sold+Gross profit

=20,00,000+5,00,000=25,00,000

Capital employed =Equity share Capital +Reserve and surplus+long – term loan

=10,00,000+200,000+3,00,000=15,00,000

Working Capital = Capital employed- Fixed Assets

=15,00,000-10,00,000=5,00,000

Working Capital Turnover=  Net sales/ Working Capital

=25,00,000/5,00,000

= 5 Times

Page No 4.116:

#### Question 110:

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. Calculate Working Capital Turnover Ratio.