Following information relates to MNP Limited for the year ended on 31st March, 2024: Inventory turnover ratio (based on cost of goods sold) 7.5…

Working Notes: Long term debt to Shareholder's fund = 0.6:1 Long term debt = 0.6 x 9,00,000 = 5,40,000 Total Assets = 17,40,000 Total Asset turnover ratio = Sales / Total Assets = 2.5 times Sales = 2.5 x 17,40,000 = 43,50,000 Current ratio = Current Assets / Current Liabilities = 2.9:1 Current Assets = 2.9 x 3,00,000 = 8,70,000 Fixed Assets = Total Assets - Current Assets = 17,40,000 - 8,70,000 = 8,70,000 Gross profit ratio = 25% on sales Gross Profit (GP) = 43,50,000 x 0.25 = 10,87,500 Cost of Good Sold (COGS) = Sales - GP = 43,50,000 -10,87,500 = 32,62,500 Inventory Turnover Ratio = Cost of Goods Sold / Average Inventory = 7.5 times Inventory = 32,62,500 / 7.5 = 4,35,000 Debtor Collection Period = Average Accounts Receivables / Average Daily Credit Sales = 30 days Receivables = 30 days x 43,50,000 / 360 days = 3,62,500 Balance Sheet as on 31st March 2024 Liabilities (₹) Assets (₹) Equity share capital 6,00,000 Fixed Assets 8,70,000 Reserve and Surplus 3,00,000 Inventories 4,35,000 Long-term loan 5,40,000 Debtors 3,62,500 Creditors 3,00,000 Cash (Balancing Figure) 72,500 Total 17,40,000 Total 17,40,000