Question

Prepare a common size statement of profit & loss from the following:

Particulars	Note No.	31.3.2022 (₹)	31.3.2021 (₹)
Revenue from Operations		54,00,000	45,00,000
Purchase of Stock in Trade		35,10,000	28,80,000
Changes in Inventories		1,08,000	(2,25,000)
Other Expenses		3,24,000	4,95,000
Income Tax		40%	35%

Answer 1

Common Size Statement of Profit & Loss for the years ended 31st March, 2022 and 2021
Particulars	Note No.	Absolute Amounts		Percentage of Revenue from Operations
		31.3.2022 (₹)	31.3.2021 (₹)	31.3.2022 (%)	31.3.2021 (%)
I. Revenue from operations		54,00,000	45,00,000	100.00	100.00
II. Less: Expenses:
Purchase of Stock in Trade		35,10,000	28,80,000	65.00	64.00
Changes in Inventories		1,08,000	(2,25,000)	2.00	(5.00)
Other Expenses		3,24,000	4,95,000	6.00	11.00
Total Expenses		39,42,000	31,50,000	73.00	70.00
III. Profit before Tax		14,58,000	13,50,000	27.00	30.00
IV. Less: Tax		5,83,200	4,72,500	10.80	10.50
V. Profit after Tax		8,74,800	8,77,500	16.2	19.50

Working Note:

1. Total Expenses = Purchase + Changes in Inventory + Other Expenses

2022: ₹ 35,10,000 + ₹ 1,08,000 + ₹ 3,24,000 = ₹ 39,42,000

2021: ₹ 28,80,000 – ₹ 2,25,000 + ₹ 4,95,000 = ₹ 31,50,000

2. Profit Before Tax = Revenue from operations – Total Expenses

2022: ₹ 54,00,000 – ₹ 39,42,000 = ₹ 14,58,000

2021: ₹ 45,00,000 – ₹ 31,50,000 = ₹ 13,50,000

3. Income Tax

2022: 40% of ₹ 14,58,000 = ₹ 5,83,200

2021: 35% of ₹ 13,50,000 = ₹ 4,72,500

4. Profit After Tax = Profit Before Tax – Tax

2022: ₹ 14,58,000 – ₹ 5,83,200 = ₹ 8,74,800

2021: ₹ 13,50,000 – ₹ 4,72,500 = ₹ 8,77,500