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Home Questions NMMS9TS8HP
Target Exam

CUET

Subject

Accountancy

Chapter

Accounting Ratios

Question:

ABC Ltd has a business of shoes in New Delhi. From the last year profits of the company has reduced so the company wants to know the earning capacity and liquidity position of its company so that it can take correct measures. Following information is available to the company.

1) Cash revenue from operations was 1/3rd of total revenue from operations
2) Cash revenue from operations was ₹140000
3) Cash purchase was 25% of credit purchase
4) Cash purchase was ₹50000
5) Opening inventory ₹30000
6) Closing inventory was ₹10000 more than opening inventory
7) Carriage is ₹12000 & Non current liabilities is ₹80000
8) Total assets is ₹800000 & fixed assets is ₹540000
9) Non-current investments ₹110000 & Shareholders funds ₹600000

What is the total revenue from operations?

Options:

₹420000

₹520000

₹450000

₹550000

Correct Answer:

₹420000

Explanation:

The correct answer is option 1- ₹420000.

Cash revenue from operations was 1/3rd of total revenue from operations.

So, If cash revenue from operations = ₹1 then total revenue from operations will be ₹3
If cash revenue from operations is ₹140000, So the Total revenue from operations will be 140000 X 3 = ₹420000

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