Ratios solutions to the Past papers Questions (corrections are welcome, if any)
Q.3, 2013
Theory
Q.8, 2012
(a) - Sales:............................................ .Rs. 450000
- Current Assets: ..................................200,000
- Stock:............................................ .....60000
- COGS:............................................. ....360000
- Average Collection Period:.......................60 days
- G.P:.............................................. ......90000
(b) - Working Capital:....................................Rs. 500,000
- Current Ratio:.......................................3:1
- Quick Ratio:.........................................2.4 :1
- Inventory Turnover:..............................4 times
- A/R Turnover:......................................72 days
- G.P Margin:.........................................70 %
- N.P Margin:.........................................37 %
- Operating Expenses Rate:......................32%
Q.8, 2011
(a) - Inventory Turnover:..............................5 times
- A/R Turnover:......................................9 times
- Total operating expenses:......................657000
- G.P percentage:...................................35%
- Return on average
- Stock holder equity:..............................20%
- Return on average assets:......................8.9%
(b) Yes, it would be prudent decision to have long term loans. Since return on Equity is 20%; and interest payable on long term loan would be 12%, so the company can make an additional profit of 8%.
Q.4, 2010
- Current Ratio:............................................ ..06:1
- Quick Ratio:............................................ ....0.25:1
- Debt to Equity Ratio:....................................1.7:1
- Fixed Assets Ratio:.......................................1.5:1
- Proprietary Ratio:.........................................0.3 :1
Q.3, 2009
- G.P:.............................................. ............4, 50,000
- COGS:............................................. ..........13, 50,000
- Average Inventory:...................................... 225000
- Debtor:........................................... ...........200000
- Debtors Turnover:........................................9 times
- Current Liabilities:...................................... .. 300000
- Total Assets:........................................... ...1500000
- Total Debts:............................................ ...900000
Required Balance Sheet:
Assets
Cash.............................................. ...........30000
M/s................................................. ..........25000
A/R................................................. ..........200000
Inventory......................................... ..........225000
Net fixed Assets..........................................10 20000
Total Assets...........................................1 500000
Liabilities + O/E
A/P................................................. ..........120000
Notes Payable........................................... .160000
Accruals.......................................... ..........20000
Long Term Debts.........................................600, 000
S.H Equity............................................ .....600,000
Total............................................. ...........1500000
Q.4, 2008
I solved these ratios only for company X…
- Current Ratio:............................................ 1.9:1
- Quick Ratio:............................................ ..1.23:1
- Net Profit Margin........................................3.8%
- Stock Turn over:........................................9.6 times
- Debt to Equity Ratio....................................0.64:1
Q. 2, 2007
Pending
Q.4, 2006
- Current Ratio (2004)....................................2:1
- Current Ratio (2005)....................................2:1
- Quick Ratio (2004)......................................0.5:1
- Quick Ratio (2005)......................................1:1
- Working Capital (2004).................................300000
- Working Capital (2005).................................250,000
Later compare the same ratios with reference to standard ratio. Standard Ratio are as follows:
Current Ratio............................................. .2:1
Quick Ratio............................................. ...1:1
Working Capital: Depends on the size and nature of a company.
Q. 4, 2003
Pertinent Ratios are:
Only solved for 2001
- Current Ratio:............................................ 2.1:1
- Operating Profit Margin:...............................5 %
- Return on Total resources:...........................7.49%
- N.P Margin:........................................... ....2.07%
- Return on investment:................................7.49%
- Return on Capital Employed:........................24.15%
- Return on Equity Capital:............................12.48 %
Q. 3, 2002
- Working Capital:........................................Rs . 5, 75,500
- Current Ratio:...........................................3 .9:1
- Acid Test Ratio:........................................ 2:1
- Debtors Turnover:......................................4 times
- Average collection Period:............................90 days
- Inventory Turnover:....................................1.9 times
- Ratio of S.H Equity to
- Total Liabilities:...................................... ....2.4:1
Q.3, 2001
(1)Ratio of Net Sales to
Average total Assets (1999).........................0.6:1
Ratio of Net Sales to
Average total Assets (2000).........................0.7:1
(2)Ratio of Net Sales to
Average Plant & Assets (1999)......................1.7:1
Ratio of Net Sales to
Average Plant & Assets (2000)......................1.8:1
(3)The Rate earned on Net Sales (1999):............2.5%
The Rate earned on Net Sales (2000):............4.5%
(4)Gross Profit Ratio (1999):.............................34%
Gross Profit Ratio (2000):.............................37%
(5)Rate Earned on avg.
Total Assets (1999):...................................2.5%
Rate Earned on avg.
Total Assets (2000):...................................5%
(6)Rate earned on avg. shares
Holder Equity (1999):..................................3.4%
Rate earned on avg. shares
Holder Equity (2000):..................................6.8%
(7)The number of times bond
Interest requirements were
Earned (before income taxes) (1999).............3.67 times
The number of times bond
Interest requirements were
Earned (before income taxes) (2000).............7.67 times
(8)Number of Times Preferred
Dividend earned (1999)...............................2.08 times
Number of Times Preferred
Dividend earned (2000)...............................4.5 times