Following are the summarised Balance sheet of ABC Ltd.:Liabilities20092010Assets20092010$$$$Share Capital3,00,000 4,50,000 Machinery5,00,000 6,00,000Debentures1,00,000 1,50,0001,00,000 1,00,000 Furniture80,000 StockSundry Creditors75,00050,00060,000Reserves and Surplus1,50,000 1,75,000 Debtors10,00050,000Profit and Loss A/c1,60,000 1,85,000Cash50,000 50,000Bank50,000 60,000Discount on issue of shares25,000 20,0007,85,000 9,90,0007,85,000 9,90,000You are required to give possible reasons for changes in operational profits andcomment on its operational efficiency, if operating profits for the year 2009 were$ 40,000 and sales for the years 2009 and 2010 were $ 2,50,000 and $ 4,50,000respectively.

Ratio is the indicated quotient of two mathematical expressions and as the relationship between two…

Following are the summarised Balance sheet of ABC Ltd.: Liabilities 2009 2010 Assets 2009 2010 $ $ 3,00,000 4,50,000 Machinery 5,00,000 6,00,000 Share Capital Debentures 1,00,000 1,00,000 Furniture 1,00,000 1,50,000 Sundry Creditors 75,000 80,000 Stock 50,000 60,000 10,000 50,000 Reserves and Surplus Profit and Loss A/c 1,50,000 1,75,000 Debtors 1,60,000 1,85,000 Cash Bank 50,000 50,000 50,000 60,000 Discount on issue of shares 25,000 20,000 7,85,000 9,90,000 7,85,000 9,90,000 You are required to give possible reasons for changes in operational profits and comment on its operational efficiency, if operating profits for the year 2009 were $ 40,000 and sales for the years 2009 and 2010 were $ 2,50,000 and $ 4,50,000 respectively.

Following are the summarised Balance sheet of ABC Ltd.: Liabilities 2009 2010 Assets 2009 2010 $ $ 3,00,000 4,50,000 Machinery 5,00,000 6,00,000 Share Capital Debentures 1,00,000 1,00,000 Furniture 1,00,000 1,50,000 Sundry Creditors 75,000 80,000 Stock 50,000 60,000 10,000 50,000 Reserves and Surplus Profit and Loss A/c 1,50,000 1,75,000 Debtors 1,60,000 1,85,000 Cash Bank 50,000 50,000 50,000 60,000 Discount on issue of shares 25,000 20,000 7,85,000 9,90,000 7,85,000 9,90,000 You are required to give possible reasons for changes in operational profits and comment on its operational efficiency, if operating profits for the year 2009 were $ 40,000 and sales for the years 2009 and 2010 were $ 2,50,000 and $ 4,50,000 respectively.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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