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3.36 Analysis of Financial Statements—CBSE XII
Capital Employed:

1. Liabilities Approach = Share Capital + Reserves and Surplus + Long-term Borrowings
= ` 13,00,000 – ` 2,50,000 + ` 5,00,000 = ` 15,50,000.

2. Assets Approach = Property, Plant and Equipment + Non-current Investments (Trade) +
Working Capital (i.e., Current Assets – Current Liabilities)
= ` 11,20,000 + ` 2,00,000 + (` 1,70,000 + ` 1,40,000
+ ` 1,20,000 – ` 1,00,000 – ` 70,000 – ` 30,000) = ` 15,50,000.

Illustration 35.
Matrix Ltd.
COMMON-SIZE STATEMENT OF PROFIT & LOSS for the years ended 31st March, 2023 and 2024
Particulars Note Absolute Amounts Percentage of Revenue from
No. Operations
31st March, 31st March, 31st March, 31st March,
2023 (`) 2024 (`) 2023 (`) 2024 (`)
I. Revenue from Operations 16,00,000 20,00,000 100.00 100.00
II. Employees Benefit Expenses 8,00,000 10,00,000 50.00 50.00
Other Expenses 2,00,000 1,00,000 12.50 5.00
III. Total Expenses 10,00,000 11,00,000 62.50 55.00
IV. Profit before Tax (I – III) 6,00,000 9,00,000 37.50 45.00
From the above, compute Operating Ratio.

Solution:
Operating Ratio 31st March, 2023 31st March, 2024
Operating Cost ` 10,00,000 ` 11,00,000 100
Revenue from Operations 100 = ` 16,00,000 100 = ` 20,00,000
= 62.50% = 55%
Illustration 36.
From the following Balance Sheet of Moon Ltd. as at 31st March, 2024, prepare a
Common-size Balance Sheet and compute Proprietary Ratio:
Particulars Note No. 31st March,
2024 (`)
I. EQUITY AND LIABILITIES
1. Shareholders’ Funds
(a) Share Capital 60,00,000
(b) Reserves and Surplus 8,00,000
2. Non-Current Liabilities
Long-term Borrowings 20,00,000
3. Current Liabilities
Short-term Borrowings 12,00,000
Total 1,00,00,000