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Question
Prepare a Common size statement of profit and loss of Shefali Ltd. with the help of following information:
| Particulars | 2015-16 (Rs) |
2016-17 (Rs) |
| Revenue from operations | 6,00,000 | 8,00,000 |
| Indirect expense | 25% of gross profit | 25% of gross profit |
| Cost of revenue from operations | 4,28,000 | 7,28,000 |
| Other incomes | 10,000 | 12,000 |
| Income tax | 30% | 30% |
Solution
Common Size Income Statement
for the years ended March 31, 2016 and 2017
|
Particulars |
Note No. |
2015-16 (₹) |
2016-17 (₹) |
Percentage of Sales |
|
|
2015-16 |
2016-17 |
||||
|
1. Revenue from Operations |
|
6,00,000 |
8,00,000 |
100 |
100 |
|
2. Other Income |
|
10,000 |
12,000 |
1.67 |
1.5 |
|
3. Total Revenue (1 + 2) |
|
6,10,000 |
8,12,000 |
101.67 |
101.5 |
|
4. Expenses |
|
|
|
|
|
|
a. Cost of Revenue from Operations (COGS) |
|
4,28,000 |
7,28,000 |
71.33 |
91 |
|
b. Other Expenses |
|
43,000 |
18,000 |
7.17 |
2.25 |
|
Total Expenses |
|
4,71,000 |
7,46,000 |
78.5 |
93.25 |
|
5. Profit before Tax (3 – 4) |
|
1,39,000 |
66,000 |
23.167 |
8.25 |
|
Less: Income Tax |
|
(41,700) |
(19,800) |
5.35 |
|
|
6. Profit After Tax |
|
97,300 |
46,200 |
16.22 |
5.775 |
|
|
|
|
|
|
|
Working Notes:
1. Calculation of Other Expenses
Other Expenses = Indirect Expenses = % of Gross Profit
Gross Profit = Net Sales - Revenue from Operations
For 2016, Gross Profit = ₹(6,00,000 - 4,28,000) = ₹1,72,000
For 2017, Gross Profit = ₹(8,00,000 - 7,28,000) = ₹72,000
2016 = 172000 × 25% = ₹ 43000
2017 = 72000 × 25 % = ₹ 18000
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|
|
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|
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|||
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