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Question
Revenue from Operations: Cash Sales ₹ 5,00,000; Credit Sales ₹ 6,00,000; Sales Return ₹ 1,00,000. Current Assets ₹ 3,00,000; Current Liabilities ₹ 1,00,000. Calculate Working Capital Turnover Ratio.
Solution
Net Sales = Cash Sales + Credit Sales − Sales Returns
= 5,00,000 + 6,00,000 − 1,00,000 = 10,00,000
Working CApital = Current Assets - Current Liabilities
= 300000 - 100000 = 200000
Working Capital Turnover Ratio = `"Net Sales"/"Working Capital"`
`= 1000000/200000` = 5 times
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Particulars |
Note |
₹ |
| I. EQUITY AND LIABILITIES : 1. Shareholder's Funds : |
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(a) Share Capital |
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70,000 |
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