G.P. & N.P. CALCULATION IS RIGHT OR WRONG

Last year GP and NP ratio shall not be directly extrapolated.

It should reflect the Current 9m (Apr 10 to Dec 10) performance.

If at all accounts have not been drawn up for the above 9m, 12m accounts to be drawn up and the 12m % can be used for 9m ratios.
 

Hi friends my suggestion is that normally the GP & NP ratio is calculated by dividing GP & NP by sales i.e.

GP Ratio = GP / Sales & NP Ratio = NP/ Sales

So u dont need to convert the ratio for 9m.

U have to take 9m Sales for finding GP & NP at 31.12.2010

For example total sales for 10-11 is 12000 then have to find the sales for 9m months as 9000 in that 9000 u have to apply ur GP & NP ratio (12.28% & 2.89%) to find the GP & NP at 31.12.2010

Thanks If i am wrong plz correct me.

R Shriram