Page 376 - VIRANSH COACHING CLASSES

5 : (Quick ratio) :
Current Liabilities ` 1,50,000, Bank Overdraf ` 50,000
Working Capital ` 4,00,000 and inventory ` 1,00,000.
Calculate Quick Ratio.

Solution : Current Assets = Current Liabilities + Working Capital
= 1,50,000 + 4,00,000
= ` 5,50,000

Quick Assets = Current Assets - Inventory
= 5,50,000 - 1,00,000
= ` 4,50,000

Quick Liabality = Current Liabilities - Bank Overdraft

= 1,50,000 - 50,000
= 1,00,000
Quick Assets
Quick Ratio =
Quick liabilities

4,50,000
= = 4.5 : 1
1,00,000
(B) Income Statement Ratio :
6 : (Gross Profit Ratio)

Calculate the Gross Profit Ratio
Sales ` 5,40,000, Net purchase ` 3,00,000
Sales Return ` 40,000 Closing stock ` 50,000
Opening stock ` 90,000

Solution :

Cost of goods sold = Opening Stock + Purchases - Closing Stock
= 90,000 + 3,00,000 - 50,000
= ` 3,40,000

Net Sales = Sales - Sales Return

= 5,40,000 - 40,000
= 5,00,000
Gross Profit = Net Sales - Cost of Goods Sold

= 5,00,000 - 3,40,000

= ` 1,60,000
Gross Profit
Gross Profit Ratio = × 100
Net Sales
1,60,000
= × 100 = 32%
5,00,000

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