Net Profit Ratio

Q.

If sales is Rs 10, 00, 000, sales returns is Rs 50, 000, Profit Before Tax is Rs 2, 00, 000, Income tax is 40%, Net profit ratio is___

1. 12.63 %

2. 20 %

3. 10 %

4. 50%

Q.

How does closing inventory affect profit?

Q.

Net profit ratio signifies___

1. Operational profitability

2. Big term solvency

3. Liquidity position

4. All of these

Q.

If sales is Rs 5, 00, 000 and net profit is Rs 1, 20, 000. Net Profit ratio is ___

1. 24%

2. 46%

3. 60%

4. None of these

Q.

At what rate percent will a sum of money double itself in $7years?$

Q.

Net profit ratio is calculated by ___

1. None of these

2. $\left(\frac{\text{Gross Profit}}{\text{Gross Sales}}\right)\times 100$

3. $\left(\frac{\text{Gross Profit}}{\text{Net Sales}}\right)\times 100$

4. $\left(\frac{\text{Net Profit}}{\text{Net Sales}}\right)\times 100$

Q.

Assets are held for the purpose of___________

1. Resale

2. Personal purpose

3. Earning revenue

4. Conversion into cash

Q.

Net profit ratio determines _______________

1. overall efficiency of the business

2. working efficiency of the management

3. working efficiency of the internal management

4. None of these

Q.

In Net Profit Ratio, the denominator is ___

1. Net purchases

2. Credit sales

3. Net sales

4. None of these

Q. Net profit ratio is expressed in .

1. pure ratio
2. times
3. days
4. percentage

Q. Gross Profit Ratio for a firm remains same but the net profit ratio is decreasing. The reason for such behavior could be _________.

1. Increase in Expense
2. Increase in Costs of Goods Sold
3. Increase in Dividend
4. Decrease in Sales

Q. Objective Type Questions :
State whether following statements are true or false :

Gross profit depends upon net sales.

Q. Given:
Sales = Rs. 10000
Contribution = Rs. 50000
Assets = Rs. 200000
Fixed cost = Rs.10000
What will be the P/V Ratio?

1. 50%
2. 80%
3. 60%
4. 90%

Q. Net profit ratio is defined as the ratio of to the revenue from operations.

1. operating profit
2. net profit
3. gross profit
4. total profit

Q. Trade Payables Turnover Ratio
= ______________ / __________________

1. Average Trade Receivables / Net Credit Purchases
2. Net Trade Purchases / Average Trade Receivables
3. Net Credit Purchases / Average Trade Payables
4. None of these

Q. R sends goods costing Rs. $2,00,000$ to K. R's expenses Rs. $5,000$. K's expenses in relation to sales Rs. $2,000$. $80\%$ of the goods were sold at $20\%$ above cost. The profit on consignment will be ________.

1. Rs. $26,000$
2. Rs. $32,000$
3. Rs. $26,200$
4. Rs. $(6,000)$

Q. income is an income which is not related to the operations of a firm.

1. Other operating
2. Operating
3. Non-operating
4. Direct

Q. Ratio of 'Net sales' to 'Net Working Capital' _________________.

1. Liquidity ratio
2. Capital gearing ratio
3. Profitability ratio
4. Working capital turnover ratio

Q.

Q. What is the relation between net national product at market price and net national product at factor cost

Q. When ratio is calculated using both figures from the income statement it is known as .

1. Balance sheet ratios
2. Income statement ratios
3. Composite ratios
4. All of the above

Q. Given:
Sales = Rs. 13000
P/V Ratio = 20%
Rent = 1000
Fixed cost = Rs. 10000
what will be Profit __________.

1. Rs. 30000
2. Rs. 29000
3. Rs. 16000
4. All of these

Q. Answer the following question in only 'one' sentence.
What is the formula for calculating gross profit ratio?

Q. Which of the following account(s) will be affected, while rectifying the error of a purchase return of Rs.$200$ to Mr."A" entered in sales book instead of purchase return book?

1. A's account only
2. Sales account only
3. Purchase returns account and Sales account
4. Purchases account only

Q. Goods costing Rs. $2,00,000$ sent out to consignee at Cost plus $25\%$. Invoice value of the goods will be.

1. Rs. $2,50,000$
2. Rs. $3,00,000$
3. Rs. $2,40,000$
4. None

Q. Normal profit situation is actually a situation when __________.

1. it is a zero profit situation
2. a firm earns just enough to cover explicit and opportunity costs
3. both A and B
4. none of the above

Q. Which of the following should not be called as sales?

1. Good sold for cash
2. Office fixtures sold
3. Good sold on credit
4. Sale of item previously included in purchase