Class name Subject Book title Chapter number Content Created at
Class XII Accountancy Accountancy Part-II 5 of various concepts used in ratio analysis. For example, there is no standard definition of liquid liabilities. Normally, it includes all current l...
Class XII Accountancy Accountancy Part-II 5 the ratios are classified as follows: Reprint 2026-27 AccountingRatios 199 1. ‘Statement of Profit and Loss Ratios: A ratio of two variables from t...
Class XII Accountancy Accountancy Part-II 5 due to stakeholders as and when it is due is known as liquidity, and the ratios calculated to measure it are known as ‘Liquidity Ratios’. These are...
Class XII Accountancy Accountancy Part-II 5 following information: Particulars (Rs.) Inventories 50,000 Trade receivables 50,000 Advance tax 4,000 Cash and cash equivalents 30,000 Trade payab...
Class XII Accountancy Accountancy Part-II 5 Particulars Note (Rs.) No. I. Equity and Liabilities 1. Shareholders’ funds (a) Share capital 8,00,000 (b) Reserves and Surplus 1 1,00,000 2. Share...
Class XII Accountancy Accountancy Part-II 5 of long-term debts in capital employed. Low ratio provides security to lenders and high ratio helps management in trading on equity. In the above c...
Class XII Accountancy Accountancy Part-II 5 debts by assets. It is calculated as Total assets to Debt Ratio = Total assets/Long-term debts Taking the data of Illustration 8, this ratio will b...
Class XII Accountancy Accountancy Part-II 5 : 1 Rs.1,50,000 Reprint 2026-27 AccountingRatios 211 Shareholders’ Funds iii) Proprietary Ratio = Total Assets Rs.5,00,000 = Rs.7,00,000 = 0.71 : 1...
Class XII Accountancy Accountancy Part-II 5 This will also leave the ratio unchanged as purchase of goods on credit neither affect Debt nor equity. 5.7.5 Interest Coverage Ratio It is a ratio...
Class XII Accountancy Accountancy Part-II 5 calculated under this category are 1. Inventory Turnover; 2. Trade receivable Turnover; 3. Trade payable Turnover; 4. Investment (Net assets) Turno...
Class XII Accountancy Accountancy Part-II 5 _________ ratios are a measure of the speed with which various accounts are converted into revenue from operations or cash: A. activity B. liquidit...
Class XII Accountancy Accountancy Part-II 5 Turnover Ratio = Average Inventory Rs.3,60,000 = = 6.55 times Rs.55,000 Illustration 14 A trader carries an average inventory of Rs. 40,000. His in...
Class XII Accountancy Accountancy Part-II 5 also helps in working out the average collection period. The ratio is calculated by dividing the days or months in a year by trade receivables turn...
Class XII Accountancy Accountancy Part-II 5 good policy as it may affect the reputation of the business. The average period of payment can be worked out by days/ months in a year by the Trade...
Class XII Accountancy Accountancy Part-II 5 52,000 4,20,000 = 1,42,000 = 2.96 times (iv) Average Payment Period = Trade Payables Turnover Ratio = 2.96 = 123 days *Since no information regardi...
Class XII Accountancy Accountancy Part-II 5 Rs. 30,00,000 Solution: Revenue from Operations = Rs. 30,00,000 Capital Employed = Share Capital + Reserves and Surplus + Long-term Debts (or Net A...
Class XII Accountancy Accountancy Part-II 5 summarised in the statement of profit and loss. Profitability ratios are calculated to analyse the earning capacity of the business which is the ou...
Class XII Accountancy Accountancy Part-II 5 Cash Purchases + Credit Purchases – Return Outwards = Rs.15,000 + Rs.60,000 – Rs.2,000 = Rs. 73,000 Cost of Revenue from = Purchases + (Opening Inv...
Class XII Accountancy Accountancy Part-II 5 the following information: Rs. Revenue from Operations 3,40,000 Cost of Revenue from Operations 1,20,000 Selling expenses 80,000 Administrative Exp...
Class XII Accountancy Accountancy Part-II 5 Rs. 5,55,555 Net profit = Rs.5,55,555 – 50,000 = Rs.5,05,555 Net profit ratio = Net profit/Revenue from Operations × 100 = Rs.5,05,555/Rs.22,22,222...
Class XII Accountancy Accountancy Part-II 5 This ratio is very important from equity shareholders point of view and also for the share price in the stock market. This also helps comparison wi...
Class XII Accountancy Accountancy Part-II 5 40,000 + Rs. 50,000 = Rs.2,40,000 Capital Employed = Equity Share Capital + Preference Share Capital + Reserves + Debentures = Rs. 4,00,000 + Rs. 1...
Class XII Accountancy Accountancy Part-II 5 assets of a company from the following information: Inventory turnover ratio = 4 times Inventory at the end is Rs. 20,000 more than the inventory i...
Class XII Accountancy Accountancy Part-II 5 Debentures 3,00,000 Current liabilities 1,00,000 Net Profit Before Tax 3,51,000 Cost of revenue from operations 5,00,000 Calculate: i) Current Rati...
Class XII Accountancy Accountancy Part-II 5 per share iii) Dividend payout ratio = Earnings per share 1.50 = = 0.6 2.50 Market price of a share iv) Price earning ratio = Earnings per share = ...