Following information is available for the year 2016-17, calculate gross profit ratio:

Explanation

Revenue from Operations = Cash Revenue from Operations + Credit Revenue from Opration
= Rs.25,000 + Rs.75,000 = Rs. 1,00,000
Net Purchases = Cash Purchases + Credit Purchases – Return Outwards =
Rs.15,000 + Rs.60,000 – Rs.2,000 = Rs. 73,000
Cost of Revenue from = Purchases + (Opening Inventory – Closing Inventory) +
operations Direct Expenses
= Purchases + Decrease in inventory + Direct Expenses
= Rs.73,000 + Rs.10,000 + (Rs.2,000 + Rs.5,000)
= Rs.90,000 Gross Profit
= Revenue from Operations – Cost of Revenue from Operation
= Rs.1,00,000 – Rs.90,000 =
Rs. 10,000
Gross Profit Ratio = Gross Profit/Net Revenue from Operations `xx100`
= Rs.10,000/Rs.1,00,000 `xx100`
`= 10%`.