The following is the Profit & Loss Account of avita Private Ltd. for theyear ending 31st December, 1986.$$To Opening stock6,35,0003,15,0001,02,000 By Cash salesPurchases5,29,000Credit sales9,50,00015,000 9,35,00092,000Returns17,000 5,12,000ReturnsСarriageWagesGross Profit5,000 By Closing stock55,0003,53.00010,27,00010,27,000AdministrativeExpenses:3,53,000By Gross ProfitNon-operatingIncome:Salaries35,00020,00015,0005,000RentDividend on shares3,500To DepreciationSundry exp.Selling andDistributionProfit on saleof shares8,50085,000exp:AdvertisingSalesmen'sSalary &1,05,00014,000CommissionOther selling exps.Non-operating exps:Loss on saleof machineryTo Net Profit11,00075,0003,65,0003,65,000You are required to calculate:(1) Gross Profit Ratio(2) Operating Profit Ratio(3) Operating Ratio

Introduction From the given information in the problem we will calculate the ratios in the following…

The following is the Profit & Loss Account of avita Private Ltd. for the year ending 31st December, 1986. $ 1,02,000 By Cash sales $ To Opening stock " Purchases 6,35,000 3,15,000 5,29,000 Credit sales 9,50,000 15,000 9,35,000 92,000 Returns 17,000 5,12,000 Returns Сarriage Wages 5,000 By Closing stock 55,000 Gross Profit 3,53,000 10,27,000 10,27,000 Administrative Expenses: 3,53,000 By Gross Profit Non-operating Income: Salaries 35,000 20,000 15,000 Rent Dividend on shares 3,500 To Depreciation Sundry exp. Selling and Distribution Profit on sale 5,000 of shares 8,500 85,000 exp: Advertising Salesmen's Salary & Commission 1,05,000 14,000 Other selling exps. Non-operating exps: Loss on sale of machinery To Net Profit 11,000 75,000 3,65,000 3,65,000 You are required to calculate: (1) Gross Profit Ratio (2) Operating Profit Ratio (3) Operating Ratio

The following is the Profit & Loss Account of avita Private Ltd. for the year ending 31st December, 1986. $ 1,02,000 By Cash sales $ To Opening stock " Purchases 6,35,000 3,15,000 5,29,000 Credit sales 9,50,000 15,000 9,35,000 92,000 Returns 17,000 5,12,000 Returns Сarriage Wages 5,000 By Closing stock 55,000 Gross Profit 3,53,000 10,27,000 10,27,000 Administrative Expenses: 3,53,000 By Gross Profit Non-operating Income: Salaries 35,000 20,000 15,000 Rent Dividend on shares 3,500 To Depreciation Sundry exp. Selling and Distribution Profit on sale 5,000 of shares 8,500 85,000 exp: Advertising Salesmen's Salary & Commission 1,05,000 14,000 Other selling exps. Non-operating exps: Loss on sale of machinery To Net Profit 11,000 75,000 3,65,000 3,65,000 You are required to calculate: (1) Gross Profit Ratio (2) Operating Profit Ratio (3) Operating Ratio

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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