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CH-5: BUSINESS ARITHMETIC


                                                     CODE:241605010124



               ASSESSMENT:

                   1.  What are “Carrying Costs”?
                   2.  What is ABC analysis?
                   3.  What is Pareto’s Principle?
                   4.  Explain Inventory Control and state its objectives
                   5.  Calculate working capital of Raja & Co. has the following items in its Balance sheet: Stock —
                       50,000; Trade creditors – 32,000; Debtors – 75000; Cash -1,00000; Dividend payable – 50,000;
                       Tax – 44,000; Short term loan – 61,000; Short term investments – 76,000. Calculate gross and
                       net working capital.
                   6.  Ramu is buying and selling ice-cream. Explain his working capital requirement.
                   7.  Calculate EOQ, if annual consumption is 120 units, cost per order is Rs.20/-, Price per unit is
                       Rs.100/- Storage cost as percentage of inventory is 12% of price per unit.
                   8.  What do you understand by ROE ?
                   9.   What do you mean by ROI?
                   10.  What is EBITDA?
                   11.  Explain profitability ratio.
                   12.  Give one point of differentiation between Depreciation and Amotisation.
                   13.  Differentiate between ROI & ROE.
                   14.  Calculate ROI & ROE from the following data:-
                       Total investment Rs.10 lakh, Owner’s equity Rs.4 lakh, Loan Rs.6 lakhs from SBI @ 10% interest
                       PA,  Sales  revenue  Rs.7  lakhs  per  month,  COGS  Rs.3  lakh  per  month,  Salary  and  Utility
                       Rs.10,000/- per month, Rent Rs.6,000/- per month, Depreciation Rs.12,000/- PA, Tax @ 20% PA.
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