Question

Q. 88. Calculate Working Capital Turnover Ratio from the following particulars
₹
Cost of Revenue from Operations
12,00,000
20% of Revenue
Gross Profit
from Operations
Share Capital
5,00,000
General Reserve
1,50,000
Surplus i.e., Balance in Statement of Profit & Loss (20,000)
Long-term Borrowings
1,40,000
Long-term Provisions
50,000
Non-Current Assets
4,20,000​

Answer 1

Answer:

Operations

Share Capital

5,00,000

General Reserve

1,50,000

Surplus i.e., Balance in Statement of Profit & Loss (20,000)

Long-term Borrowings

1,40,000

Explanation:

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Answer 2

Answer:

Working capital turnover ratio = Net sales ÷ Working capital × 100

Therefore, 400000 ÷ 4800000 × 100 = 8.3333%

Explanation:

1. Total of the following liabilities= 820000

• Share Capital  5,00,000
• General Reserve 1,50,000
• Surplus i.e., Balance in Statement of Profit & Loss (20,000)
• Long-term Borrowings  1,40,000
• Long-term Provisions  50,000

2. Total of Non-Current Assets = 4,20,000​

3. Working capital = Total of Liabilities -Total of Non-Current Assets

                                i.e. 820000 -420000 = 400000

4. Total Sales = 1200000 ÷20% =6000000

5. Net sales= 6000000-(20% ×6000000) = 4800000