The following information of ASD Ltd. relate to the year ended 31st March, 2026: Net profit 8% of sales Raw materials consumed 20% of Cost of Goods…

Working Notes: (i) Calculation of Sales Fixed Assets / Sales = 1/3 1,30,00,000 / Sales = 1/3 ⇒ Sales = ₹3,90,00,000 (ii) Calculation of Current Assets Fixed Assets / Current Assets = 13/11 1,30,00,000 / Current Assets = 13/11 ⇒ Current Assets = ₹1,10,00,000 (iii) Calculation of Raw Material Consumption and Direct Wages ₹ Sales 3,90,00,000 Less: Gross Profit (15% of Sales) 58,50,000 Cost of Goods sold 3,31,50,000 Raw Material Consumption (20% of Cost of Goods Sold) = ₹3,31,50,000 × 20% = ₹66,30,000 Direct Wages (10% of Cost of Goods Sold) = ₹3,31,50,000 × 10% = ₹33,15,000 (iv) Calculation of Stock of Raw Materials (= 3 months usage) = 66,30,000 × (3/12) = ₹16,57,500 (v) Calculation of Stock of Finished Goods (= 6% of Cost of Goods Sold) = 3,31,50,000 × (6/100) = ₹19,89,000 (vi) Calculation of Current Liabilities Current Assets / Current Liabilities = 2/1 1,10,00,000 / Current Liabilities = 2/1 ⇒ Current Liabilities = ₹55,00,000 (vii) Calculation of Debtors Average collection period = (Debtors / Credit Sales) × 12 months 2 = (Debtors / 3,90,00,000) × 12 ⇒ Debtors = ₹65,00,000 (viii) Calculation of Long-term Loan Long term Loan / Current Liabilities = 2/1 Long term loan / 55,00,000 = 2/1 ⇒ Long term loan = ₹1,10,00,000 (ix) Calculation of Cash Balance ₹ Current assets 1,10,00,000 Less: Debtors 65,00,000 Raw materials stock 16,57,500 Finished goods stock 19,89,000 1,01,46,500 Cash balance 8,53,500 (x) Calculation of Net worth ₹ Fixed Assets 1,30,00,000 Current Assets 1,10,00,000 Total Assets 2,40,00,000 Less: Long term Loan 1,10,00,000 Current Liabilities 55,00,000 1,65,00,000 Net worth 75,00,000 Net worth = Share capital + Reserves = ₹75,00,000 Capital / Reserves and Surplus = 1/4 Capital = ₹75,00,000 × (1/5) = ₹15,00,000 Reserves and Surplus = ₹75,00,000 × (4/5) = ₹60,00,000 Profit and Loss Statement of ASD Ltd. for the year ended 31st March, 2026 Particulars (₹) Particulars (₹) To Direct Materials consumed 66,30,000 By Sales 3,90,00,000 To Direct Wages 33,15,000 To Works (Overhead) (Bal. fig.) 2,32,05,000 To Gross Profit c/d (15% of Sales) 58,50,000 3,90,00,000 3,90,00,000 To Selling and Distribution Expenses (Bal. fig.) 27,30,000 By Gross Profit b/d 58,50,000 To Net Profit (8% of Sales) 31,20,000 58,50,000 58,50,000 Balance Sheet of ASD Ltd. as at 31st March, 2026 Liabilities (₹) Assets (₹) Share Capital 15,00,000 Fixed Assets 1,30,00,000 Reserves and Surplus 60,00,000 Current Assets: Long term loans 1,10,00,000 Stock of Raw Material 16,57,500 Current liabilities 55,00,000 Stock of Finished Goods 19,89,000 Debtors 65,00,000 Cash 8,53,500 2,40,00,000 2,40,00,000