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Model Test Papers M.513

(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
Or
(a) Current Assets = Total Assets – Non-current Assets
= ` 17,60,000 – ` 8,00,000 = ` 9,60,000
Current Liabilities = Total Assets – Capital Employed
= ` 17,60,000 – ` 16,00,000 = ` 1,60,000
Current Assets ` 9,60,000
Current Ratio = = = 6 :1.
Current Liabilities ` 1,60,000
(b) Total Assets = Capital Employed + Current Liabilities
= ` 6,00,000 + ` 2,00,000 = ` 8,00,000
Total Assets ` 8,00,000
Total Assets to Debt Ratio = = = 2 : 1.
Debt ` 4,00,000
23. (a) CASH FLOW FROM OPERATING ACTIVITIES

Particulars ` `
Surplus, i.e., Balance in the Statement of Profit and Loss as on 31st March, 2018 71,000
Less: Surplus, i.e., Balance in the Statement of Profit and Loss as on 31st March, 2017 89,000
Net Loss during the year (18,000)
Add: Dividend Paid 36,000
Tax paid 23,000 59,000
Net Profit before Tax and Extraordinay Items 41,000
Add: Non-cash and Non-operating items:
Depreciation on Machinery 18,000
Loss on Sale of Machinery (` 50,000 – ` 20,000 – ` 10,000) 20,000 38,000
Operating Profit before Working Capital Changes 79,000
Add: Increase in Current Liabilities:
Outstanding Expenses ( ` 14,600 – ` 10,000) 4,600
83,600
Less: Increase in Current Assets:
Inventory (` 12,000 – ` 4,000) 8,000
Trade Receivables (` 58,000 – ` 45,000) 13,000 21,000
Cash Flow from Operating Activities before Tax 62,600
Less: Tax paid 23,000
Cash Flow from Operating Activities 39,600

Note: As the Gain (Profit) on sale of Non-current Investment ` 2,000 has not been transferred to Statement of
Profit and Loss but to Capital Reserve, it will not be adjusted while computing Operating Profit before
Working Capital Changes.