Particulars To Opening Stock To Purchases (balancing figure) To Gross Profit c/d Particulars By Sales By Closing Stock 8,00,000 1,00,000 20.00 6,80,000 200,000 9,00,000 40.00 1,60,000 2,00,000 9.00.000 2.00.000 To Expenses To Net Profit By Gross Profit b/d 2,00.000 BALANCE SHEET as on.... 2 Liabilities Capital: Openings balance Add: Net Profit 6,40,000 LG), MMO Assets Fixed Assets Closing Stock Other Current Assets (balancing figure) 10,00,000 1,00,000 13,00,000 8,00,000 Liabilities 16.000.000 24.00,000 24,00.000 j62 6. Fixed Assets are 10,00,000 Fixed Assets + Capital = 54 Capital = 10,00,000 X 4+ 5 = 8,00,000. 2. Capital is 1/2 of Total Liabilities Liabilities = 8,00,000 x 2 = 16,00,000, 3. Net Profit is 1/5 of Capital Net Profit = 8,00,000 x 1/5 = 1,60,000. 4. Net Profit is 20 per cent of Sales . Sales = 1,60,000 100 20 = 8,00,000 5. Gross Profit Ratio is 25 per cent of Sales Gross Profit = 2,00,000 Stock Turnover Ratio (ie.. Cost of Sales/Average Inventory) is 10 Cost of Sales = Sales - Gross Profit = 8,00,000 - 2,00,000 = 6,00,000 Average Inventory is 6,00,000 7. Closing Stock is 1,00,000. Average Inventory is 60,000. Opening Stock is 20,000 8. Fixed Assets are 10,00,000. Fixed Assets/Total Current Assets = 5 + 7 Total Current assets are 10,00,000 x 7/5 + 14,00,000 Stock is 1,00,000 .. Other Current Assets are 13,00,000. Illustration 11.26. From the following particulars prepare the Balance Sheet of Shri Mohan Ram & Co. Ltd. Current Ratio 2 Working Capital 4,00,000 Capital Block to Current Assets 3:2 .. 1:3 1:2 2 Months 2 Months 3 Months Fixed Assets to Turnover Sales Cash/Credit Stock Velocity Creditors Velocity Debtors Velocity Capital Block: Net profit 10% of Turnover Reserve 2.5% of Turnover Debentures Share Capital Gross Profit Ratio 25% (to Sales) 1:2