Page No
3.38:
Question
25:
Prepare
Common-size Balance Sheet and comment on the financial position of Sun Ltd.
and Star Ltd. The Balance Sheet of Sun Ltd. and Star Ltd. as at 31st
March, 2019 are:
|
Particulars |
Sun Ltd. ( `) |
Star Ltd. ( `) |
|
I. EQUITY AND LIABILITIES |
|
|
|
1. Shareholders' Funds |
|
|
|
(a) Share Capital |
9,00,000 |
12,00,000 |
|
(b) Reserves and Surplus |
4,00,000 |
3,50,000 |
|
2. Current Liabilities |
|
|
|
Trade Payables (Creditors) |
2,00,000 |
2,50,000 |
|
Total |
15,00,000 |
18,00,000 |
|
II. ASSETS |
|
|
|
1. Non-Current Assets |
|
|
|
Fixed Assets (Tangible) |
10,00,000 |
16,00,000 |
|
2. Current Assets |
|
|
|
Trade Receivables (Debtors) |
5,00,000 |
2,00,000 |
|
Total |
15,00,000 |
18,00,000 |
|
|
|
|
Answer:
|
Common Size Balance Sheet as at March
31, 2019 |
||||
|
Particulars |
Absolute Amount (`) |
Percentage of Balance Sheet Total (%) |
||
|
Sun Ltd. |
Star Ltd. |
Sun Ltd. |
Star Ltd. |
|
|
I. Equity and Liabilities |
|
|
|
|
|
1. Shareholders’
Funds |
|
|
|
|
|
a. Share Capital |
9,00,000 |
12,00,000 |
60.00 |
66.67 |
|
b. Reserve and
Surplus |
4,00,000 |
3,50,000 |
26.67 |
19.44 |
|
2. Current
Liabilities |
|
|
|
|
|
a. Trade Payables |
2,00,000 |
2,50,000 |
13.33 |
13.89 |
|
Total |
15,00,000 |
18,00,000 |
100.00 |
100.00 |
|
II. Assets |
|
|
|
|
|
1. Non-Current
Assets |
|
|
|
|
|
a. Fixed Assets |
10,00,000 |
16,00,000 |
66.67 |
88.89 |
|
2. Current
Assets |
|
|
|
|
|
a. Trade
Receivables |
5,00,000 |
2,00,000 |
33.33 |
11.11 |
|
Total |
15,00,000 |
18,00,000 |
100.00 |
100.00 |
|
|
|
|
|
|
Comments:
1. Star Ltd. has a greater share of Capital in the total sources of funds i.e. 66.67% in comparison to 60% of Sun Ltd.
2. Sun Ltd. retains 26.67% of their earnings as a part of Reserves and Surplus. Whereas, Star Ltd. retains only 19.44% of their earnings.
3. Star Ltd. has invested major portion of its funds on acquiring the Fixed Assets as these are 88.89% of the total application of funds in comparison to 66.67% of Sun Ltd. On the other hand, Sun Ltd. emphasizes more on Current Assets as these are 33.33% of the total applications of funds in comparison to 11.11% of Star Ltd.
Page No 3.38:
Question 26:
From the following information, prepare a Common-size Balance Sheet:
|
BALANCE SHEET as at 31st March, 2021 |
|||
|
Particulars |
Note No. |
March, 31st 2021 (`) |
31st March, 2020 (`) |
|
I.
EQUITY AND LIABILITIES |
|
|
|
|
1.
Shareholders' Funds |
|
|
|
|
(a) Share Capital |
|
32,00,000 |
18,00,000 |
|
(b) Reserves and Surplus |
|
8,00,000 |
6,00,000 |
|
2.
Non-Current Liabilities |
|
|
|
|
Long-term Borrowings |
|
16,00,000 |
12,00,000 |
|
3.
Current Liabilities |
|
|
|
|
Short-term Borrowings |
|
8,00,000 |
12,00,000 |
|
Total
|
|
64,00,000 |
48,00,000 |
|
Il.
ASSETS |
|
|
|
|
1.
Non-Current Assets |
|
|
|
|
(a) Property, Plant and Equipment (Fixed Assets): |
|
|
|
|
Tangible Assets |
|
18,00,000 |
16,00,000 |
|
(b) Non-current Investments |
|
8,00,000 |
6,00,000 |
|
2.
Current Assets |
|
|
|
|
(a) Inventories |
|
10,00,000 |
8,00,000 |
|
(b) Trade Receivables |
|
16,00,000 |
12,00,000 |
|
(c) Cash and Cash Equivalents |
|
12,00,000 |
6,00,000 |
|
Total |
|
64,00,000 |
48,00,000 |
Answer:
|
Common-Size Statement of Balance
Sheet as at 31st March, 2021 |
|||||
|
Particulars |
Note No. |
Absolute Amounts |
Percentage of Revenue from Operation (Net Sales) |
||
|
31st March, 2020
(`) |
31st March, 2021 (`) |
% 31st March, 2020
(`) |
% 31st March, 2021 (`) |
||
|
I.
EQUITY AND LIABILITIES |
|
|
|
|
|
|
1.
Shareholders' Funds |
|
|
|
|
|
|
(a) Share Capital |
|
18,00,000 |
32,00,000 |
37.5 |
50 |
|
(b) Reserves and Surplus |
|
6,00,000 |
8,00,000 |
12.5 |
12.5 |
|
2.
Non-Current Liabilities |
|
|
|
|
|
|
Long-term Borrowings |
|
12,00,000 |
16,00,000 |
25 |
25 |
|
3.
Current Liabilities |
|
|
|
|
|
|
Short-term Borrowings |
|
12,00,000 |
8,00,000 |
25 |
12.5 |
|
Total
|
|
48,00,000 |
64,00,000 |
100 |
100 |
|
Il.
ASSETS |
|
|
|
|
|
|
1.
Non-Current Assets |
|
|
|
|
|
|
(a) Property, Plant and Equipment (Fixed Assets): |
|
|
|
|
|
|
Tangible Assets |
|
16,00,000 |
18,00,000 |
33.33 |
28.13 |
|
(b) Non-current Investments |
|
6,00,000 |
8,00,000 |
12.5 |
12.5 |
|
2.
Current Assets |
|
|
|
|
|
|
(a) Inventories |
|
8,00,000 |
10,00,000 |
16.67 |
15.62 |
|
(b) Trade Receivables |
|
12,00,000 |
16,00,000 |
25 |
25 |
|
(c) Cash and Cash Equivalents |
|
6,00,000 |
12,00,000 |
12.5 |
18.75 |
|
Total |
|
48,00,000 |
64,00,000 |
100 |
100 |
Click on Below link for more questions Of Volume-3 of 12th
Chapter-1: Tools of Financial statement analysis- Comparative statement and Common-Size statement | 2021-2022
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