मराठी

From the following information, calculate ‘Return on Investment’: Shareholders Funds ₹ 16,00,000 10% Debentures ₹ 8,00,000 Current Liabilities ₹ 2,00,000 Current Assets ₹ 5,00,000

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प्रश्न

From the following information, calculate ‘Return on Investment’:

Shareholders Funds ₹ 16,00,000
10% Debentures ₹ 8,00,000
Current Liabilities ₹ 2,00,000
Current Assets ₹ 5,00,000
Non-current Assets ₹ 21,00,000

Net profit after tax was ₹ 3,00,000, and the tax amounted to ₹ 1,00,000.

संख्यात्मक
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उत्तर

Capital employed = Shareholder’s funds + Debentures

= ₹ 16,00,000 + ₹ 8,00,000

= ₹ 24,00,000

Net profit before interest, tax and dividend = Net profit after tax + Tax

= ₹ 3,00,000 + ₹ 1,00,000

= ₹ 4,00,000

Interest Expense:

$$\text{Interest on 10\% Debentures} = ₹ 8,00,000 \times \frac{10}{100} = ₹ 80,000$$

Net Profit before Interest and Tax (EBIT):

$$\text{EBIT} = \text{Net Profit before Tax} + \text{Interest Expense}$$

$$ = ₹ 4,00,000 + ₹ 80,000$$

$$ = ₹ 4,80,000$$

Return on investment = `"Net profit before interest, tax and dividend"/"Capital employed" xx 100`

= `(4,80,000)/(24,00,000) xx 100`

= 20%

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Notes

The Return on Investment (ROI) is 20%.

Given Data:

  • Shareholders’ Funds: ₹ 16,00,000
  • 10% Debentures: ₹ 8,00,000
  • Current Liabilities: ₹ 2,00,000
  • Current Assets: ₹ 5,00,000
  • Non-Current Assets: ₹ 21,00,000
  • Net Profit after Tax: ₹ 3,00,000
  • Tax Amount: ₹ 1,00,000

Calculation of Capital Employed:

Using the Liabilities side approach:
$$\text{Capital Employed} = \text{Shareholders’ Funds} + \text{Long-term Debt (10\% Debentures)}$$
$$\text{Capital Employed} = ₹ 16,00,000 + ₹ 8,00,000$$
$$\mathbf{\text{Capital Employed} = ₹ 24,00,000}$$

Calculation of Net Profit before Interest and Tax (EBIT):

  1. Net Profit before Tax:
    $$\text{Net Profit before Tax} = \text{Net Profit after Tax} + \text{Tax}$$
    $$\text{Net Profit before Tax} = ₹ 3,00,000 + ₹ 1,00,000 = ₹ 4,00,000$$
  2. Interest Expense:
    $$\text{Interest on 10\% Debentures} = ₹ 8,00,000 \times \frac{10}{100} = ₹ 80,000$$
  3. Net Profit before Interest and Tax (EBIT):
    $$\text{EBIT} = \text{Net Profit before Tax} + \text{Interest Expense}$$
    $$\text{EBIT} = ₹ 4,00,000 + ₹ 80,000$$
    $$\mathbf{\text{EBIT} = ₹ 4,80,000}$$


$$\text{Return on Investment} = \left( \frac{\text{Net Profit before Interest and Tax (EBIT)}}{\text{Capital Employed}} \right) \times 100$$
$$\text{Return on Investment} = \left( \frac{4,80,000}{24,00,000} \right) \times 100 = 20\%$$ 
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पाठ 4: Accounting Ratios - EXERCISE [पृष्ठ ४.१३४]
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