Practical Problem 15

Calculate Net Profit Ratio from the following

Sales

₹ 3,80,000

Cost of good sold

₹ 2,60,000

Indirect Exp

₹ 60,000

SOLUTION:

Sales

₹ 3,80,000

Less: Cost of goods sold

₹ 2,60,000

Gross profit

₹ 1,20,000

Less: Indirect expense

₹ 60,000

Net profit

₹ 60,000

Net Profit Ratio = (Net Profit ÷ Sales) × 100

∴ Net Profit Ratio = (60000 ÷ 380000) × 100

∴ Net Profit Ratio = 15.79 %