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Accountancy · 2026 · 4 marks
CBSE 2026 · Region 5 · Set 1 · Q33
'Net Asset Turno ver ratio of a company is 2 times. State with reason ' whether the following transactions will increase, decrease or not affect the…
'Net Asset Turno ver ratio of a company is $\displaystyle 2$ times. State with reason ' whether the following transactions will increase, decrease or not affect the ratio : (i) Cash sales $\displaystyle 3,00,000$ (ii) Issue of equity shares $\displaystyle 10,00,000$ (iii) Issue of $\displaystyle 9$% debentures $\displaystyle 5,00,000$ (iv) Credit purchase of goods $\displaystyle 50,000$
From the following information, calculate 'Proprietary Ratio' and 'Debt -to- Equity Ratio' : () Equity Share Capital $\displaystyle 3,00,000$ Preference Share Capital $\displaystyle 1,00,000$ Reserves and Surplus $\displaystyle 1,00,000$ Plant and Machinery $\displaystyle 3,50,000$ Non-Current Investments $\displaystyle 1,00,000$ Current Assets $\displaystyle 2,00,000$ Long-term Borrowings $\displaystyle 1,50,000$
Marking-scheme solution
S No. Transactions Effect Reason
(i)
Cash Sales Increase Cash sales will increase revenue from
₹$\displaystyle 3,00,000$ operations while there is no change in value
of net assets/capital employed.
(ii)
Issue of Decrease Issue of equity shares will increase the
equity shares value of net assets/capital employed and no
₹$\displaystyle 10,00,000$ change in revenue from operations.
(iii)
Issue of $\displaystyle 9$% Decrease Issue of $\displaystyle 9$% debentures will increase the
debentures value of net assets/capital employed and no
₹$\displaystyle 5,00,000$ change in revenue from operations.
(iv)
Credit No effect Credit purchase of goods will not affect
purchase of either revenue from operations nor capital
goods employed. It will have no effect on any
₹$\displaystyle 50,000$ components of the ratio.
Q.(b) From the following information, calculate …………………………….
Ans.
Proprietary Ratio = Shareholders’ Funds/ Total Assets
Shareholders’ Funds= Equity Share Capital+ Preference Share Capital +Reserves and Surplus
= $\displaystyle 3,00,000$ + $\displaystyle 1,00,000$ + $\displaystyle 1,00,000$
= ₹ $\displaystyle 5,00,000$
Total Assets= Plant and Machinery + Non- Current investments + Current Assets
= $\displaystyle 3,50,000$ + $\displaystyle 1,00,000$ + $\displaystyle 2,00,000$
= ₹ $\displaystyle 6,50,000$
Proprietary Ratio = $\displaystyle 500000$/$\displaystyle 650000$
= $\displaystyle 10$/$\displaystyle 13$
= $\displaystyle 0$ .77 :$\displaystyle 1$
Debt -to-Equity Ratio = Debt / Equity
Debt = Long Term Borrowings
= ₹ $\displaystyle 1,50,000$
Equity = ₹ $\displaystyle 5,00,000$
Debt Equity Ratio = $\displaystyle 150000$/$\displaystyle 500000$
= $\displaystyle 0$ .3:$\displaystyle 1$
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CBSE Class 12 Accountancy past-paper question from the 2026 board exam, with the answer as CBSE’s own marking scheme gives it. Where our answers come from.