Page 318 - AAAXII

M.304 An Aid to Accountancy—CBSE XII

` 13,20,000
= = 8.25 Times.
` 1,60,000
Opening Inventory + Closing Inventory
Average Inventory =
2
` 1,50,000 + 1,70,000`
= = ` 1,60,000.
2
Notes:
• Total Revenue from Operations = Cash Revenue from Operations + Credit Revenue from Operations
= ` 10,00,000 + (` 10,00,000 × 120/100) = ` 22,00,000.
• Gross Profit = Total Revenue from Operations × Rate of Gross Profit/100
= ` 22,00,000 × 40/100 = ` 8,80,000.

• Cost of Revenue from Operations = Total Revenue from Operations – Gross Profit
= ` 22,00,000 – ` 8,80,000 = ` 13,20,000.
• Operating Expenses = 10% of Total Revenue from Operations
= ` 22,00,000 × 10/100 = ` 2,20,000.
• Operating Cost = Cost of Revenue from Operations + Operating Expenses
= ` 13,20,000 + ` 2,20,000 = ` 15,40,000.
Or
(a) Let the Current Assets after acquisition of Inventories be X

Current Assets
Current Ratio =
Current Liabilities
2 = X
+ 10,000
1 ` 90,000 `
X = ` 1,00,000 × 2 = ` 2,00,000
Working Capital (i.e., CA – CL) after acquisition = ` 2,00,000 – ` 1,00,000 = ` 1,00,000
Current Assets before acquisition = Current Assets After acquisition
– Purchase of Stock on credit
= ` 2,00,000 – ` 10,000 = ` 1,90,000
Working Capital before acquisition = ` 1,90,000 – ` 90,000 = ` 1,00,000.
(b) Cost of Revenue from Operations = Operating Cost – Operating Expenses
= ` 27,20,000 – ` 3,20,000 = ` 24,00,000
Let Revenue from Operations be ` 100, Gross Profit = ` 25, Cost = ` 75,
If Cost is ` 75, then Revenue from Operations = ` 100
If Cost is ` 24,00,000 then Revenue from Operations
= ` 24,00,000 × ` 100/` 75 = ` 32,00,000.
Operating Cost
Operating Ratio = ×100
Revenue from Operations
` 27,20,000
= ¥ 100 = 85%.
` 32,00,000