The motto of Yash Ltd., an advertising company is 'Service with Dignity'. Its management and work force is hard-working, honest and motivated. The net profit of the company doubled during the year ended 31-3-2014. Encouraged by its performance company decided to give one-month extra salary to all its employees. Following is the Comparative Statement of Profit and Loss of the company for the years ended 31st March 2013 and 2014. 
(a) Calculate Net Profit Ratio for the years ending 31st March, 2013 and 2014.
(b) Identify any two values which Yash Ltd. is trying to propagate.
31/ March/ 2013:
Net Profit Ratio = ( Net profit after tax/ revenue from operations)*100
= (3,00,000/10,00,000)*100 = 30%
31/ March/2014:
Net Profit Ratio = (Net Profit after tax/ Revenue from operations)*100
= (6,00,000/ 15,00,000)* 100 = 40%
Values of Yash Ltd:
(i) Focus on consideration and welfare of employees.
(ii) Motivating and boosting the morale of employees form better performance.
From the following information related to Naveen Ltd. calculateÂ
Total Assets to Debt Ratio
Information: Fixed Assets Rs 75,00,000; Current Assets Rs 40,00,000; Current Liabilities Rs 27,00,000; 12% Debentures Rs 80,00,000 and Net Profit before Interest, Tax and Dividend Rs 14,50,000.
2) Total Assets to Debt to Ratio:
Total Assets to Debit Ratio = Total Assets/ Debts
Total Assets to Debt Ratio = Total Assets/ Debt
Total Assets = Fixed Assets + Current Assets
=75,00,000 + 40,00,000 = 1,15,00,000
Debt = 80,00,000
Total Assets to Debt Ratio = (1,15,00,000/80,00,000) = 1.44
From the following Balance Sheets of Vijaya Ltd. as on 31-3-2009 and 31-3-2010 prepare a Cash Flow Statement.
|
Liabilities |
31-3-2009 (Rs) |
31-3-2010 (Rs) |
Assets |
31-3-2009 (Rs) |
31-3-2010 (Rs) |
|
Share Capital General Reserve Profit & loss account Trade Creditors  |
45,000 15,000 10,000 8,700 |
65,000 27,500 15,000 11,000 |
Fixed Assets Stock Debtors Cash Preliminary expense |
46,700 11,000 18,000 2,000 1,000 |
83,000 13,000 19,500 2,500 500 Â |
|
 |
78,700 |
1,18,500 |
 |
78,700 |
1,18,500 |
Â
Additional Information:
(i) Depreciation on Fixed Assets for the year 2009-2010 was Rs. 14,700.
(ii) An interim dividend Rs. 7,000 has been paid to the shareholders during the year.
Cash Flow Statement
           (For the year ended 31st March 2010)
|
Particulars |
Rs |
Rs |
 | |
|
(A) Cash Flow from Operating Activities :–                 Net Profit Before Tax  Adjustment: Add 1. Depreciation on Fixed Assets                            2. written off Preliminary Expenses   Operating Profit Before Changes in Working Capital  Less : Increase in Current Assets            Stock            Debtors  Add: Increase in Current Liabilities          Trade Creditors  Cash Flow from Operating Activities :–  (B). Cash Flow from Investing Activities:  Purchase of Fixed Assets  Net Cash Used in Investing Activities :–   (C). Cash Flow from Financing Activities: Â
 Payment of Interim Dividend  Cash Flow from Financing Activities:  Net Increase in Cash & Cash Equivalent       Add: Opening Balance of Cash & Cash Equivalent               Closing Balance of Cash & Cash Equivalent |
 |
 |
 | |
|
 24500  14700  500  |
                   Â
     (51000)        13000  |
 | ||
|
 39700    (2000)  (1500)    2300  |
 | |||
|
     (51000)    |
 | |||
|
  20000  (7000) |
 | |||
|
    |
 | |||
|
500 Â 2000 Â |
 | |||
|
 2500 |
 |
|||
Working Note: Calculation of net profit before tax
|
 Net profit as per profit and loss account (15000-10000) Add transfer to general reserve Interim dividend paid during the year Net profit before tax |
 5000 12500 7000 |
||||||||||||
|
24500 |
|||||||||||||
|
 Fixed asset account
 |
 |
||||||||||||
|
 |
 |
From the following information, calculate any two of the following ratios:
(a)Â Debt-Equity Ratio
(b)Â Working Capital Turnover Ration and
(c)Â Return on Investment
Information:Â Equity Share capital Rs 50,000, General Reserve Rs 5,000; Profit and Loss
Account after tax and interest Rs 15,000; 9% Debenture Rs 20,000; Creditors Rs 15,000; Land and Building Rs 65,000; Equipment Rs 15,000; Debtors Rs 14,500 and Cash Rs 5,500. Discount on issue of shares Rs 5,000
Sales for the year ended 31-3-2011 was Rs 1,50,000. Tax rate 50%.
i) Debt equity Ratio:
= long term debt/shareholders fund
long term debt =debentures =20000
Shareholders fund = equity share capital + General reserve +P & L a/c- discount on issue of share
               = 50,000+5000+15,000 - 5000=65,000
Debt equity ratio= 20000/65000=0.31:1
Â
ii) Working Capital Turnover Ratio:
=(sales/ working capital)=150000/(current assets – current liabilities)
                         =150000/(14500+5500-15000)
                         =150000/5000=30times
Â
iii) Return on investment:
=Profit before interest and tax/ capital employed
Profit after interest and tax= 15000
Profit before tax= 15000*100/50=30000
Profit before interest and tax=30000+(9% of 20000)=30000+1800=31800
Capital employed=debt+equity=20000+65000=85000
Return on investment =31800/85000*100=37.41%
Â
From the following information related to Naveen Ltd. calculateÂ
Return on Investment
Information: Fixed Assets Rs 75,00,000; Current Assets Rs 40,00,000; Current Liabilities Rs 27,00,000; 12% Debentures Rs 80,00,000 and Net Profit before Interest, Tax and Dividend Rs 14,50,000.
Return on Investment
= (Net profit before interest, tax and dividend/Capital employed)*100
Net profit before interest, Tax and Dividend = Rs 14,50,000
Capital employed = Fixed Assets + current assets- current liabilities
= 75,00,000 + 40,00,000 – 27,00,000= 88,00,000 Rs
Return on investment = (14,50,000/88,00,000)* 100= 16.48%
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