📢 Too many exams? Don’t know which one suits you best? Book Your Free Expert 👉 call Now!

    Question

     Calculate Rate on Return on Capital

    Employed: Refer the following summarized Balance Sheet & P&L of AB Ltd. as on 31 ‐ 3 ‐ 2022.   Summarized Profit and Loss Account is as under for the year ending on 31 ‐ 3 ‐ '04:                                                                                      Rs. Sales (25% Cash sales)                                              80,00,000 Less: Cost of goods sold                                            56,00,000        Gross Profit                                                                24,00,000        Net profit (Before interest and tax 50%)                     9,00,000 Calculate the following ratios:
    A 34.88% Correct Answer Incorrect Answer
    B 30.5% Correct Answer Incorrect Answer
    C 36.65% Correct Answer Incorrect Answer
    D 33.50% Correct Answer Incorrect Answer
    E 41% Correct Answer Incorrect Answer

    Solution

    = EBIT/ Capital employed X 100 = 9,00,000 / 25,80,000 X 100 = 34.88% CE = Eq Sh. Cap. + Pref. Sh. Cap. + Reserves & Surplus + Debenture + Long Term Loan – Fictitious Assets CE = 10,00,000 + 4,00,000 + 7,00,000 + 5,00,000 – 20,000 = 25,80,000

    Practice Next
    More Financial Management Questions

    Relevant for Exams:

    ask-question