T S Grewal Solutions 2026-27 [Class 12] – Ratio Analysis– Q 101 to 110

Solution for Q 101 to 110 of Chapter 4 of Book 3 - Analysis of Financial Statements of T S Grewal Class 12 Accountancy 2026-27 are given below. The Chapter name is Ratio Analysis class 12. These Solutions are based on topics Trade receivables turnover ratio, calculation of opening and closing trade receivables and trade payables turnover ratio.

Working notes are given with each solution. These help in understanding the steps and are also important for board exams as marks are given for steps.Debt equity ratio is a key ratio is finfing the long term solvency of any business and is critical business health parameter. A higher debt equity ratio is generally considered unhealthy for business as it indicates higher dependency on external funds and future solvency problems may arise.

These solutions are also useful for CA Foundation, CS Foundation and CMA Foundation students. The solutions will be helpful for students as well as teachers teaching class 12 accounts.

Question 101
Step 1
Let the credit sales be x                  
Cash sales will be 0.25x                  
Total Sales = Credit sales + cash sales  
1500000 = x   + 0.25x    
               
x = 1500000   / 1.25    
               
  = 1200000          
               
Credit sales = 1200000          
               
Step 2              
Average = (Opening   + Closing / 2
Trade Receivables Trade Receivable   Trade Receivable)
    (400000-200000) + 400000 / 2
               
  = 200000   + 400000 / 2
               
  = 300000          
               
Step 3              
Trade Receivables = Net Credit Sales / Average Trade Receivables
Turnover Ratio 1200000   / 300000    
               
  = 4 Times        
▶ Video Solution: Coming Soon

Question 102
Step 1        
         
Debt Collection = 12 / Trade receivables turnover ratio
Period        
2 = 12 / Trade receivables turnover ratio
         
Trade receivables = 12 / 2
turnover ratio      
  = 6 times  
         
Step 2        
Trade Receivables = Net Credit / Average Trade Receivables
Turnover Ratio Sales    
6   720000 / Average Trade Receivables
         
Average Trade = 720000 / 6
Receivables      
         
Closing Trade = 120000    
Receivables      
▶ Video Solution: Coming Soon

Question 103
Step 1        
         
Debt Collection Period = 360 / Trade receivables turnover ratio
36 = 360 / Trade receivables turnover ratio
         
Trade receivables = 360 / 36
turnover ratio      
  = 10    
         
Step 2        
Trade Receivables = Net Credit Sales / Average Trade Receivables
Turnover Ratio      
10   400000 / Average Trade Receivables
         
Average Trade = 400000 / 10
Receivables      
  = 40000    
         
Step 3        
         
Let the opening trade receivables be x                    
Average Trade = (Opening   + Closing / 2
Receivables Trade Receivable   Trade Receivable)
40000   x   + x + 6000 / 2
               
80000 =   2x + 6000 / 2
               
2x = 80000   - 6000    
               
x = 74000   / 2    
               
  = 37000          
               
Opening trade receivables = 37000          
               
Closing Trade receivables = 43000          
    (37000+6000)        
▶ Video Solution: Coming Soon

Question 104
Case 1                
Trade Receivables = Net Credit Sales / Average Trade Receivables
Turnover Ratio 400000   /   100000    
                 
  = 4 Times          
                 
Case 2                
Total Sales = Credit sales + cash sales    
3000000 = x   + 600000      
                 
Credit Sales = 3000000   - 600000      
                 
  = 2400000            
                 
Now,                
Average = (Opening   + Closing   / 2
Trade Receivables Trade Receivable   Trade Receivable)  
    200000   + 600000   / 2
                 
  = 400000            
                 
Trade Receivables = Net Credit Sales / Average Trade Receivables
Turnover Ratio 2400000   /   400000    
                 
  = 6 Times          
                 
Case 3                
Step 1                
Average = (Opening   + Closing   / 2
Trade Receivables Trade Receivable   Trade Receivable)  
    50000   +   100000 / 2
                 
  = 75000            
                 
Step 2                
Gross Profit = Cost of Goods Sold X 25%      
    300000   X 25%      
                 
  = 75000            
                 
Step 3                
Total Sales = Cost of Goods Sold + Gross Profit    
    300000   + 75000      
                 
  = 375000            
                 
Step 4                
Cash Sales = Total Sales X 20%      
    375000   X 20%      
                 
  = 75000            
                 
Step 5                
Credit Sales = Total Sales - Cash Sales    
    375000   - 75000      
                 
  = 300000            
                 
Step 6                
Trade Receivables = Net Credit Sales / Average Trade Receivables
Turnover Ratio 300000   /   75000    
                 
  = 4 Times          
                 
Case 4                
Step 1                
Average = (Opening   + Closing   / 2
Trade Receivables Trade Receivable   Trade Receivable)  
    90000   +   60000 / 2
                 
  = 75000            
                 
Step 2                
Let the Sales be 100            
GP   20 (20%)          
Cost of Goods Sold 80            
                 
Gross Profit = 20 / 80 X 450000          
                 
  = 112500            
                 
Total Sales = Cost of Goods Sold + Gross Profit    
    450000   + 112500      
                 
  = 562500            
                 
Step 3                
Total Sales = Credit sales + cash sales    
562500 = x   + 0.25x      
                 
x = 562500   / 1.25      
                 
Credit Sales = 450000            
                 
Step 4                
Trade Receivables = Net Credit Sales / Average Trade Receivables
Turnover Ratio 450000   /   75000    
                 
  = 6 Times          
▶ Video Solution: Coming Soon

Question 105
Step 1              
Trade Receivables = Net Credit Sales / Average (As below)
Turnover Ratio       Trade Receivables
    800000   / 160000    
               
  = 5 Times        
               
Step 2              
Average = (Opening   + Closing / 2
Trade Receivables Trade Receivable   Trade Receivable)
    120000   + 200000 / 2
               
  = 160000          
               
(i)              
               
      Before Adjusment After        
Net Credit Sales 800000 800000        
Opening Trade Receivables 120000 120000        
Closing Trade Receivables 200000 -40000 160000        
Average Trade Receivables 160000 140000        
                   
Trade Receivables 5 5.71        
Turnover Ratio                  
Increase
 
(ii)
      Before Adjusment After        
Net Credit Sales 800000 80000 880000        
Opening Trade Receivables 120000 120000        
Closing Trade Receivables 200000 80000 280000        
Average Trade Receivables 160000 200000        
                   
Trade Receivables Turnover Ratio     5   4.4        
Decrease
 
(iii)
      Before Adjusment After        
Net Credit Sales 800000 -20000 780000        
Opening Trade Receivables 120000 120000        
Closing Trade Receivables 200000 -20000 180000        
Average Trade Receivables 160000 150000        
                   
Trade Receivables 5 5.2        
Turnover Ratio                  
Increase
 
(iv) No Impact of credit purchase on trade receivables turnover ratio                
▶ Video Solution: Coming Soon

Question 106
Trade Receivables = Net Credit Sales / Average    
Turnover Ratio     Trade Receivables
             
Step 1            
Find Revenue from operations      
Cost of revenue          
from operations = 640000        
So , Revenue from operations = 640000*100/80      
  = 800000        
             
Step 2            
Find Credit revenue from        
Operations          
             
Let credit revenue from operations be x    
             
Total Revenue from = Cash revenue + Credit revenue  
Operations from operations from operations  
             
800000 = 1/3x + x    
800000 = 4/3x        
             
x = 800000*3/4      
  = 600000        
             
Step 3            
Find Average trade Receivables      
Trade Receivables = Net Credit Sales / Average    
Turnover Ratio     Trade Receivables
4 = 600000 / Average    
        Trade Receivables
Average Trade = 600000/4        
Receivables          
  = 150000        
             
Step 4            
Find opening and closing trade receivables  
             
Let the opening trade receivables be x    
closing trade receivables = x + 20000    
             
Average Trade = (Opening Trade + Closing Trade / 2
Receivables Receivables) Receivables)  
             
150000 = x + x+20000 / 2
300000 = 2x+20000        
x = 280000/2        
  = 140000        
Openign Trade receivables = 140000        
Closing trade receivables = 140000+20000      
    160000        
▶ Video Solution: Coming Soon

Question 107
Step 1                  
Trade Receivables = Net Credit Sales / Average      
Turnover Ratio         Trade Receivables  
8     175000   /   x    
                   
Average trade = 175000   /   8    
receivables                
    = 21875            
                   
Step 2                  
Average trade = (Opening   + Closing   / 2
receivables   Trade Receivable   Trade Receivable)  
21875     x   + (x + 7000) / 2
                   
  2x = 43750   - 7000      
                   
  2x = 36750            
                   
  x = 36750   / 2      
                   
Opening trade = 18375            
receivables                
                   
Closing Trade = 25375 (Opening + 7000)        
receivables                
▶ Video Solution: Coming Soon

Question 108
Step 1                    
Let the revenue be 100                
GP   25                
Cost of goods sold 75   300000            
                     
Now,                    
We have to find Revenue (numerator) from Cost of Goods Sold (Denominator)  
                     
Revenue = 100 / 75   X 300000      
                     
  = 400000                
                     
Step 2                    
Total Revenue = Credit Revenue + Cash Revenue      
400000   = x   + 1/3 x        
                     
4x   = 400000   X 3        
                     
x   = 1200000   / 4        
                     
Credit Revenue = 300000              
                     
Step 3                    
Trade Receivables = Net Credit Sales / Average      
Turnover Ratio           Trade Receivables  
3     = 300000   /   x    
                     
Average trade receivables = 300000   / 3      
                     
      = 100000            
                     
Step 2                    
Average     = (Opening   + Closing   / 2
Trade Receivables   Trade Receivable   Trade Receivable)  
100000       (x   + (x + 3x)) / 2
                     
  5x   = 200000            
                     
  x   = 200000   / 5      
                     
  x   = 40000            
                     
Opening trade receivables = 40000            
                     
Closing Trade receivables = 160000 (Opening + 3 times opening)    
          (40000+120000)        
▶ Video Solution: Coming Soon

Question 109
Step 1              
Credit revenue = Cost of Goods Sold + Gross Profit - Cash Sales
from operations            
  = 350000 + 150000   - 200000
               
  = 300000          
               
Step 2              
Trade Receivables = Net Credit Sales / Average Trade Receivables
Turnover Ratio            
3 = 300000 /   x    
               
Average = 300000 / 3      
Trade Receivables          
  = 100000          
Case 1              
Step 3              
Average = (Opening   + Closing / 2
Trade Receivables Trade Receivable   Trade Receivable)
100000   x   + (x + 100000) / 2
               
2x = (100000 X 2) - 100000    
               
x = 100000   / 2    
               
x = 50000          
               
Opening trade = 50000          
receivables            
               
Closing Trade = 150000 (Rs 1 Lakh more than opening)  
receivables            
Case 2                
Step 3                
Average   = (Opening   + Closing / 2
Trade Receivables Trade Receivable   Trade Receivable)
100000   =   x + 3x / 2
                 
  4x = 100000   X 2    
                 
  x = 200000   / 4    
                 
  x = 50000          
                 
Opening trade = 50000          
receivables              
                 
Closing Trade = 150000   (3 times of opening)  
receivables              
                 
Case 3                
Step 3                
Average   = (Opening   + Closing / 2
Trade Receivables Trade Receivable   Trade Receivable)
100000     x   + (x+3x) / 2
                 
5x   = 100000   X 2    
                 
x   = 200000   / 5    
                 
x   = 40000          
                 
Opening trade = 40000          
receivables              
                 
Closing Trade = 160000          
receivables   (40000+120000)        
▶ Video Solution: Coming Soon

Question 110
Step 1                
Credit Purchases = Purchases - Purchase Returns - Cash Purchases
    950000 - 45000   - 100000  
                 
  = 805000            
                 
Step 2                
Average = (Opening   + Closing   / 2
Trade Payables Trade Payable   Trade Payable)    
    (125000+10000) + (90000+5000)    
                 
  = 115000            
                 
Step 3                
Trade Payables = Net Credit / Average Trade    
Turnover Ratio Purchases   Payables      
    805000   / 115000      
                 
  = 7 Times          
                 
Note : Average debt payment period not asked in question. Given here only for information                  
Step 4            
Average debt = 12   / Trade Payables Turnover Ratio
payment period          
  = 12   /   7
             
  = 1.71 Months      
▶ Video Solution: Coming Soon

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