Question : The Operating Profit Ratio of a company is 20%. State, giving reason, which of the following transactions will not alter the Operating Profit Ratio.
Option 1: Purchase of Stock-in-Trade Rs. 50,000.
Option 2: Purchases Return Rs. 10,000 .
Option 3: Revenue from Operations on sale of Stock-in-Trade Rs. 60,000
Option 4: All of the above
Correct Answer: All of the above
Solution : Answer = All of the above
If Purchase stock then Both Purchases and Closing stock will be increased by the same amount and hence the cost of Revenue from the operation will remain unchanged.
If Purchase returns then both Purchase and closing shock will decrease By the Same amount.
Revenue from operation will be increased by Rs 72,000 and closing Inventory will decrease by Rs 6,000.
Hence, the correct option is 4.
