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Model Test Papers M.377

20.

S. No. Items Main Head Sub-head
(i) Computer Software Non-current Assets Fixed Assets—Intangible Assets
(ii) Prepaid Expenses Current Assets Other Current Assets
(iii) Stores and Spares Current Assets Inventories
(iv) Capital Work-in-Progress Non-Current Assets Fixed Assets—Capital Work-in-Progress
Net Profit before Interest, Tax and Dividend
21. (a) Return on Investment = ¥ 100
Capital Employed
` 75,000
= ¥ 100 = 18.75%.
` 4,00,000
Working Notes:
1. Net Profit before Interest = Net Profit after Interest and Tax + Tax + Interest on 10% Debentures
= ` 55,000 + ` 10,000 + ` 10,000 (i.e., 10% of ` 1,00,000) = ` 75,000.
2. Capital Employed = Equity Share Capital + Preference Share Capital + Reserves and Surplus
+ 10% Debentures
= ` 1,50,000 + ` 80,000 + ` 70,000 + ` 1,00,000 = ` 4,00,000.
(b) Before we calculate Net Profit Ratio, we need to first calculate Total Revenue from
Operations.
Let Revenue from Operations = x
It means, Cash Revenue from Operations = 20% of x = 0.2x
Credit Revenue from Operations = x – 0.2x
` 8,00,000 = 0.8x
x or Revenue from Operations = ` 10,00,000
Net Profit ` 1,50,000
Net Profit Ratio = ¥ 100 = ¥ 100 = 15%.
Revenue from Operations ` 10,00,000
Note: Net Profit = Gross Profit – Indirect Expenses
= ` 3,00,000 (i.e., 30% of ` 10,00,000) – ` 1,50,000 = ` 1,50,000.
Or
Net Profit before Interest, Tax and Dividend
(a) Return on Investment = ¥ 100
Capital Employed
` 14,50,000
= ¥ 100 = 16.48%.
` 88,00,000
Net Profit before Interest, Tax and Dividend = ` 14,50,000.
Capital Employed = Fixed Assets + Current Assets – Current Liabilities
= ` 75,00,000 + ` 40,00,000 – ` 27,00,000 = ` 88,00,000.
Total Assets
(b) Total Assets to Debt Ratio =
Long-term Debts
` 1,15,00,000
= = 1.44 : 1.
` 80,00,000
Total Assets = Fixed Assets + Current Assets
= ` 75,00,000 + ` 40,00,000 = ` 1,15,00,000.
Long-term Debt = 12% Debentures = ` 80,00,000.