Particulars | Note No. | 31st March, 2017 Amt (Rs.) | |
I. | EQUITY AND LIABILITIES | ||
1. Shareholders' Funds | |||
(a) Share Capital | 1 | 16,50,000 | |
(b) Reserves and Surplus (Balance of Statement of Profit and Loss) | 3,75,000 | ||
2. Non-current Liabilities | |||
12% Debentures | 12,00,000 | ||
3. Current Liabilities | |||
Trade Payables | 5,10,000 | ||
Total | 37,35,000 | ||
II. | ASSETS | ||
1. Non-current Assets | |||
(a) Fixed Assets | 2 | 28,50,000 | |
(b) Non-current Investment | 3 | 2,25,000 | |
2. Current Assets | 6,60,000 | ||
Total | 37,35,000 |
Particulars | 2017 Amt (Rs.) | |
1. | Share Capital | |
Equity Share Capital | 15,00,000 | |
Preference Share Capital | 1,50,000 | |
16,50,000 | ||
2. | Tangible Fixed Assets | |
Fixed Assets | 34,50,000 | |
(-) Depreciation | (60,00,000) | |
28,50,000 | ||
3. | Non-current Investment | |
10% Trade Investment | 1,50,000 | |
10% Other Investment (Face value Rs. 1,06,000) | 75,000 | |
2,25,000 |
Answer:
Return on Investment (Rol) \[=\frac{\text{Net}\,\text{Profit}\,\text{before}\,\text{Interest}\,\text{and}\,\text{Tax}\,\text{(W}\text{.N}\text{.1)}}{\text{Capital}\,\text{Employed}}\times 100\] \[=\frac{7,41,000}{31,50,000}\times 100=23.52%\] Working Notes 1. Calculation of Net Profit before Interest and Tax Let the profit before tax = Rs. 100 Tax = 40% So, Prof it after tax =100 - 40= Rs. 60 If profit after tax is 60, then profit before tax = 100 If profit after tax is 1, then profit before tax \[=\,Rs.\frac{100}{60}\] If profit after tax is 3,64,500, then profit before tax\[=\frac{100}{60}\times 3,64,500=Rs.\,6,07,500\]
2. Calculation of Capital Employed (Liabilities approach) Capital Employed = Equity Share Capital + Preference Share Capital + Reserves and Surplus (Balance of statement of profit and loss) + Long-term Loan - Non-trade Investment (book-value) = 15,00,000 + 1,50,000 + 3,75,000 + 12,00,000 \[-\] 75,000 = Rs. 31,50,000 Value shown by the company is Doing your best A company does its best by analysing the financial ratios and enabling the interested parties in taking better decisions about investing and lending. Net profit before tax 6,07,500 (+) Interest on debentures \[\left( 12,00,000\times 12/100 \right)\] 1,44,000 (-) Interest on non-trade investment \[\left( 1,05,000\times 10/100 \right)\] (10,500) Net profit before interest and tax Rs. 7,41,000
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