Comprehension

Given here is information on total sales amounting to 400 million, total expenditure of 360 million and equity for the four consecutive years from 2020 to 2023. Profit is the positive difference between sales and expenditure. The data is presented in the pie charts.

Question: 1

The year in which the sales per rupee of expenditure hits its lowest point is:

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When comparing fractions, you can often estimate or just look at the percentage change from denominator to numerator. In 2021, the increase from 90 to 96 is smallest relatively.
Updated On: Feb 14, 2026
  • 2021
  • 2020
  • 2023
  • 2022
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The Correct Option is A

Solution and Explanation

Step 1: Understanding the Question:
We need to find the year where the ratio of 'Sales' to 'Expenditure' (Sales / Expenditure) is the minimum.
Step 2: Detailed Explanation:
Using the values from our preliminary calculation table, we compute this ratio for each year.


2020: \(\frac{\text{Sales}}{\text{Expenditure}} = \frac{80}{72} \approx 1.111\)
2021: \(\frac{\text{Sales}}{\text{Expenditure}} = \frac{96}{90} \approx 1.067\)
2022: \(\frac{\text{Sales}}{\text{Expenditure}} = \frac{100}{90} \approx 1.111\)
2023: \(\frac{\text{Sales}}{\text{Expenditure}} = \frac{124}{108} \approx 1.148\)
Step 3: Final Answer:
Comparing the ratios, the lowest value is approximately 1.067, which occurred in the year 2021.
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Question: 2

The year with the highest simple annual growth rate in sales is:

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The base for calculating growth rate is always the value of the previous year. A common mistake is to use the current year's value as the base.
Updated On: Feb 14, 2026
  • 2021
  • 2022
  • 2023
  • 2020
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The Correct Option is C

Solution and Explanation

Step 1: Understanding the Question:
We need to calculate the year-on-year sales growth rate for 2021, 2022, and 2023 and identify the year with the highest rate.
Step 2: Key Formula or Approach:
\[ \text{Annual Growth Rate} = \frac{\text{Current Year Sales} - \text{Previous Year Sales}}{\text{Previous Year Sales}} \times 100% \] Step 3: Detailed Explanation:
Using the sales values from our table:


Growth in 2021: \(\frac{96 - 80}{80} \times 100% = \frac{16}{80} \times 100% = 20%\)
Growth in 2022: \(\frac{100 - 96}{96} \times 100% = \frac{4}{96} \times 100% \approx 4.17%\)
Growth in 2023: \(\frac{124 - 100}{100} \times 100% = \frac{24}{100} \times 100% = 24%\)
Step 4: Final Answer:
The highest growth rate is 24%, which occurred in 2023.
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Question: 3

The year in which the profit per rupee of equity reaches its peak is:

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"Per rupee of" means you should divide by that quantity. "Profit per rupee of equity" translates to Profit / Equity.
Updated On: Feb 14, 2026
  • 2022
  • 2023
  • 2021
  • 2020
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The Correct Option is D

Solution and Explanation

Step 1: Understanding the Question:
We need to find the year where the ratio of 'Profit' to 'Equity' (Profit / Equity) is the maximum.
Step 2: Detailed Explanation:
Using the values from our preliminary calculation table, we compute this ratio for each year.


2020: \(\frac{\text{Profit}}{\text{Equity}} = \frac{8}{8} = 1.0\)
2021: \(\frac{\text{Profit}}{\text{Equity}} = \frac{6}{12} = 0.5\)
2022: \(\frac{\text{Profit}}{\text{Equity}} = \frac{10}{16} = 0.625\)
2023: \(\frac{\text{Profit}}{\text{Equity}} = \frac{16}{28} \approx 0.571\)
Step 3: Final Answer:
Comparing the ratios, the highest value (peak) is 1.0, which occurred in the year 2020.
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Question: 4

The average annual profit for the given period is:

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Ensure you sum up the values for all the periods mentioned before dividing by the number of periods to find the average.
Updated On: Feb 14, 2026
  • ₹14 million
  • ₹10 million
  • ₹12 million
  • ₹8 million
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The Correct Option is B

Solution and Explanation

Step 1: Understanding the Question:
We need to calculate the average of the profits over the four-year period (2020-2023).
Step 2: Key Formula or Approach:
\[ \text{Average} = \frac{\text{Sum of all values}}{\text{Number of values}} \] Step 3: Detailed Explanation:
From our table, the profits for the years are:


2020: ₹8 million
2021: ₹6 million
2022: ₹10 million
2023: ₹16 million
Sum of profits = 8 + 6 + 10 + 16 = ₹40 million.
Number of years = 4.
Step 4: Calculation:
\[ \text{Average Annual Profit} = \frac{40}{4} = \text{₹10 million} \] Step 5: Final Answer:
The average annual profit for the given period is ₹10 million.
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