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4.18 Management Accounting (Section B)—ISC XII

BALANCE SHEET OF ANNIE FOODS LIMITED as at 31st March, 2019
Particulars Note No. `
I. EQUITY AND LIABILITIES
1. Shareholders’ Funds
(a) Share Capital 3 1,50,000
(b) Reserves and Surplus 25,000
2. Non-Current Liabilities
Long-term Borrowings 4 30,000
3. Current Liabilities
Trade Payables 5 30,000
Total 2,35,000
II. ASSETS
1. Non-Current Assets
Fixed Assets (Tangible) 1,40,000
2. Current Assets
(a) Inventories 40,000
(b) Trade Receivables 20,000
(c) Cash and Bank Balances 35,000
Total 2,35,000

Notes to Accounts

1. Changes in Inventories `
Stock-in-Trade—Opening Inventory 30,000
Less: Closing Inventory 40,000
(10,000)
2. Other Expenses
(a) Office Expenses 10,000
(b) Selling Expenses 9,000
(c) Loss on Sale of Plant 2,000
21,000
3. Share Capital
(a) Equity Share Capital 1,20,000
(b) Preference Share Capital 30,000
1,50,000
4. Long-term Borrowings
10% Debentures 30,000
5. Trade Payables
(a) Bills Payable 10,000
(b) Creditors 20,000
30,000

Note: All calculations are to be made up to two places of decimal. (ISC 2010, Modified)
Solution:

Gross Profit ` 50,000
(i) Gross Profit Ratio = × 100 = × 100 = 73.53%.
Revenue from Operations ` 68,000
Gross Profit = Revenue from Operations – Cost of Revenue from Operations
(Cost of Goods Sold)