Question

From the following information, prepare a comparative income statement of Arun Ltd. for the year ended 31st March, 2024. 

Hint:

Comparative income statements help in evaluating the performance over different periods by comparing key financial figures. The increase or decrease in these figures helps in understanding the business trends.

Answer 1

Step 1: Calculate the Gross Profit. 
Gross Profit = Revenue from Operations - Cost of Material Consumed
For 2024: \[ \text{Gross Profit (2024)} = 40,00,000 - 40,00,000 = 0 \] For 2023: \[ \text{Gross Profit (2023)} = 20,00,000 - 20,00,000 = 0 \] Step 2: Calculate the Operating Profit. 
Operating Profit is calculated by subtracting other expenses from the Gross Profit. For 2024: \[ \text{Operating Profit (2024)} = 0 - 30,00,000 = -30,00,000 \] For 2023: \[ \text{Operating Profit (2023)} = 0 - 12,00,000 = -12,00,000 \] Step 3: Calculate the Net Profit. 
Net Profit is calculated after deducting tax. For 2024: \[ \text{Net Profit (2024)} = \text{Operating Profit (2024)} \times (1 - 30%) = -30,00,000 \times 0.70 = -21,00,000 \] For 2023: \[ \text{Net Profit (2023)} = \text{Operating Profit (2023)} \times (1 - 30%) = -12,00,000 \times 0.70 = -8,40,000 \] Step 4: Comparative Income Statement.