Accountancy, asked by riya291213, 1 year ago

Following information of B ltd. is given:
Particulars
2018 2019
Revenue from operation 35,00,000 89,00,000
Gross profit
840000 1869000
Operating profit
4,90,000 10,68,000
'Current assets
11,20,000 16,14,000
Current liability
5,50,000 9,10,000
Ma Amit CE 0 of the company claims, that improved
in the profit & working capital is due to his
efficiency so he should be duly compensated
do you agree with him if not give lesson.​

Answers

Answered by choudharyrekha022
0

Answer:

working capital =current assets -current liabilities

2018=1120000 - 550000=570000

2019=1614000 - 910000=704000

Answered by madeducators2
0

Mr.Amit should not be compensated.

Explanation:

Statement showing comparison of Current Ratio and GP Ratio for 2 years

Particulars                                         2018                            2019        

Gross Profit                                     8,40,000                      18,69,000

                                                                                                           

Revenue from Operations             35,00,000                     89,00,000

                                                                                                             

GP Ratio[\dfrac{Gross Profit}{Revenue} \times 100]           24%                                   21%

                                                        [\dfrac{840000}{3500000}\times 100]              [\dfrac{1869000}{8900000}\times 100]

                                                                                                               

Current Assets                                   11,20,000                      16,40,000

                                                                                                                 

Current Liabilities                               5,50,000                       9,10,000

                                                                                                                

Current Ratio                                        2.036                          1.802

[\dfrac{Current assets}{CurrentLiabilities}]                            [\dfrac{1120000}{550000}]                        [\dfrac{1640000}{910000}]

                                                                                                                     

  • From the above comparison statement,it can be seen that the Company's Gross profit Ratio and Current ratio have declined under the supervision of Mr.Amit as CEO.

  • Therefore,Mr.Amit should not be compensated for the results of current year 2019.

                         

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