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Comparative Statements and Common-Size Statements 5.9
Solution: COMMON-SIZE STATEMENT OF PROFIT & LOSS OF STAR PAPER MILLS LIMITED
for the Current Calendar Year
Particulars Absolute Amount Percentage of Industry Average
Net Sales
` % %
I. Revenue from Operations (Net Sales) 70,00,000 100.00 100.00
II. Other Income 35,000 0.50 0.60
III. Total Revenue (I + II) 70,35,000 100.50 100.60
IV. Expenses
(a) Cost of Materials Consumed 48,00,000 68.57 67.00
(b) Changes in Inventories of Finished Goods and WIP 2,40,000 3.43 3.00
(c) Employees Benefit Expenses 5,74,000 8.20 9.20
(d) Other Expenses 5,18,000 7.40 9.40
Total Expenses 61,32,000 87.60 88.60
V. Profit before Tax (III – IV) 9,03,000 12.90 12.00
VI. Less: Provision for Tax 4,06,000 5.80 5.50
VII. Profit after Tax 4,97,000 7.10 6.50

Comments: The above table reveals that profit after tax of the company is more than the
industry percentage. The reason for this is better control on expenses resulting in lower
expenses. Expenses other than cost of merchandise sold (i.e., Employees Benefit Expenses
+ Other Expenses) 15.6% are also less than industry average, i.e., 18.6%.
Note: Analysis of Common-Size Statement of Profit & Loss is not in Syllabus. It is given for better understanding.
Illustration 5.
From the following Balance Sheet of Y Ltd., prepare Comparative Balance Sheet:
Particulars Note No. 31st March, 31st March,
2024 (`) 2023 (`)
I. EQUITY AND LIABILITIES
1. Shareholders’ Funds
(a) Share Capital 25,00,000 25,00,000
(b) Reserves and Surplus 6,00,000 5,00,000
2. Non-Current Liabilities
Long-term Borrowings 15,00,000 15,00,000
3. Current Liabilities
(a) Short-term Borrowings 2,40,000 2,25,000
(b) Trade Payables 2,25,000 2,00,000
(c) Other Current Liabilities 55,000 50,000
(d) Short-term Provisions 30,000 25,000
Total 51,50,000 50,00,000
II. ASSETS
1. Non-Current Assets
(a) Property, Plant and Equipment and Intangible Assets:
—Property, Plant and Equipment 36,00,000 30,00,000
(b) Non-current Investments 5,00,000 5,00,000
2. Current Assets
(a) Inventories 5,50,000 7,50,000
(b) Trade Receivables 3,00,000 5,00,000
(c) Cash and Cash Equivalents 1,75,000 1,50,000
(d) Other Current Assets 25,000 1,00,000
Total 51,50,000 50,00,000