Financial Statements

Ratios

Medium

If there are Fixed assets of Rs.10,00,00 Current assets of Rs.6,00,000, Current liabilities of Rs.3,00,000 and Net profit before Interest and Tax of Rs.2,60,000; then Return on Investment will be:

25%

30%

20%

15%

✅ Correct Option: 3

Capital Employed = Fixed Assets + Working Capital = 10,00,000 + (6,00,000 - 3,00,000) = 13,00,000.

ROI = (Net Profit before Interest and Tax / Capital Employed) x 100 = (2,60,000 / 13,00,000) x 100 = 20%.

Note: Fixed assets taken as Rs.10,00,000 (the PDF shows 10,00,00 which we have interpreted as 10,00,000 based on the answer options).

2025: 14 May Shift 2

Return on Shareholders' Funds

2022: 30 Aug Shift 2

What are the different types of liquidity ratios

A. Interest coverage ratio

B. Current ratio

C. Inventory turnover ratio

D. Gross profit ratio

E. Acid test ratio

Choose the correct answer from the options given below:

2025: 13 May Shift 2

Average payment period is -

2025: 3 June Shift 1

Match List-I with List-II

List–I	List–II
(A) Profitability Ratios	(I) This refers to the ratios that are calculated for measuring the efficiency of operations of a business based on effective utilization of resources.
(B) Activity Ratios	(II) The ability of a business to pay the amount due to stakeholders as and when it is due.
(C) Liquidity Ratios	(III) The ability to meet its contractual obligations towards stakeholders, particularly towards external stakeholders.
(D) Solvency Ratios	(IV) It refers to the analysis of profits in relation to revenue from operations or funds (or assets) employed in the business.

Choose the correct answer from the options given below:

2025: 3 June Shift 2

To assess the long term solvency of the business, which of the following ratios are needed?

(A) Interest coverage ratio

(B) Proprietary ratio

(D) Debt to capital employed ratio

Choose the correct answer from the options given below:

2025: 27 May Shift 2

Calculate 'Liquid Ratio' from the following information:

Solution