From the following Balance sheets of Royal Sugar Mills Ltd. as at 31st March, 2024 and 2025, prepare a Comparative Balance Sheet :

Particulars Note No. 31-3-2025 (Rs.) 31-3-2024 (Rs.)
I. Equity and Liabilities :
1. Shareholders' Funds
Share Capital 24,00,000 20,00,000
2. Non-current Liabilities
Long term borrowings 12,00,000 10,00,000
3. Current liabilities
Trade Payables 6,00,000 5,00,000
Total 42,00,000 35,00,000
II. Assets :
1. Non-Current Assets
Property, plant and equipment and intangible assets 30,00,000 25,00,000
2. Current Assets
(a) Inventories 2,00,000 4,00,000
(b) Cash & Cash equivalents 10,00,000 6,00,000
Total 42,00,000 35,00,000

Q: From the following Balance sheets of Royal Sugar Mills Ltd. as at 31st March, 2024 and 2025, prepare a Comparative Balance Sheet : | Particulars | Note No. | 31-3-2025 (Rs.) | 31-3-2024 (Rs.) | |---|---|---|---| | I. Equity and Liabilities : | | | | | 1. Shareholders' Funds | | | | | Share Capital | | 24,00,000 | 20,00,000 | | 2. Non-current Liabilities | | | | | Long term borrowings | | 12,00,000 | 10,00,000 | | 3. Current liabilities | | | | | Trade Payables | | 6,00,000 | 5,00,000 | | Total | | 42,00,000 | 35,00,000 | | II. Assets : | | | | | 1. Non-Current Assets | | | | | Property, plant and equipment and intangible assets | | 30,00,000 | 25,00,000 | | 2. Current Assets | | | | | (a) Inventories | | 2,00,000 | 4,00,000 | | (b) Cash & Cash equivalents | | 10,00,000 | 6,00,000 | | Total | | 42,00,000 | 35,00,000 |

**Comparative Balance Sheet of Royal Sugar Mills Ltd. as at 31st March, 2024 and 2025:** | Particulars | 31-3-2024 (Rs.) | 31-3-2025 (Rs.) | Absolute Change (Rs.) | % Change | |---|---|---|---|---| | **I. Equity and Liabilities** | | | | | | Share Capital | 20,00,000 | 24,00,000 | 4,00,000 | 20.00% | | Long-term borrowings | 10,00,000 | 12,00,000 | 2,00,000 | 20.00% | | Trade Payables | 5,00,000 | 6,00,000 | 1,00,000 | 20.00% | | **Total** | **35,00,000** | **42,00,000** | **7,00,000** | **20.00%** | | **II. Assets** | | | | | | PPE and Intangible Assets | 25,00,000 | 30,00,000 | 5,00,000 | 20.00% | | Inventories | 4,00,000 | 2,00,000 | (2,00,000) | (50.00%) | | Cash & Cash equivalents | 6,00,000 | 10,00,000 | 4,00,000 | 66.67% | | **Total** | **35,00,000** | **42,00,000** | **7,00,000** | **20.00%** |

Particulars	31-3-2025 (Rs.)	31-3-2024 (Rs.)
I. Equity and Liabilities :
1. Shareholders' Funds
Share Capital	24,00,000	20,00,000
2. Non-current Liabilities
Long term borrowings	12,00,000	10,00,000
3. Current liabilities
Trade Payables	6,00,000	5,00,000
Total	42,00,000	35,00,000
II. Assets :
1. Non-Current Assets
Property, plant and equipment and intangible assets	30,00,000	25,00,000
2. Current Assets
(a) Inventories	2,00,000	4,00,000
(b) Cash & Cash equivalents	10,00,000	6,00,000
Total	42,00,000	35,00,000

Tools for Financial Statement Analysis

Comparative Balance Sheet

Official Answer

Comparative Balance Sheet of Royal Sugar Mills Ltd. as at 31st March, 2024 and 2025:

Particulars	31-3-2024 (Rs.)	31-3-2025 (Rs.)	Absolute Change (Rs.)	% Change
I. Equity and Liabilities
Share Capital	20,00,000	24,00,000	4,00,000	20.00%
Long-term borrowings	10,00,000	12,00,000	2,00,000	20.00%
Trade Payables	5,00,000	6,00,000	1,00,000	20.00%
Total	35,00,000	42,00,000	7,00,000	20.00%
II. Assets
PPE and Intangible Assets	25,00,000	30,00,000	5,00,000	20.00%
Inventories	4,00,000	2,00,000	(2,00,000)	(50.00%)
Cash & Cash equivalents	6,00,000	10,00,000	4,00,000	66.67%
Total	35,00,000	42,00,000	7,00,000	20.00%

comparative balance sheetabsolute changepercentage changetools for financial statement analysishorizontal analysisbase year

Marking Scheme

11 mark: correct Absolute Change column for all items.
21 mark: correct Percentage Change column for all items.
31 mark: correct format/headings and accurate totals tallying on both sides.

Hint

$\% \text{Change} = (\text{Current year} - \text{Previous year}) \div \text{Previous year} \times 100$ ; always use the earlier year as base.

Quick Oral Answer

A Comparative Balance Sheet shows two years' figures with absolute and percentage change columns — here, total assets and liabilities both grew 20%, while inventories fell 50% and cash rose sharply by 66.67%.

Analysis & Explanation

Concept: A Comparative Balance Sheet places two years' figures side by side and adds Absolute Change ( $\text{Amount}_2 - \text{Amount}_1$ ) and Percentage Change ( $\text{Absolute Change} \div \text{Base year amount} \times 100$ ) columns to reveal the direction and pace of change.

Reading the numbers: Total assets/liabilities grew a uniform 20% overall, driven by proportionate growth in Share Capital, borrowings and trade payables on one side, and by fixed asset expansion plus a strong cash build-up on the other. Inventories actually FELL by 50%, even as the overall balance sheet grew — worth flagging as it may signal improved inventory management or a stock shortage.

Exam trap: Percentage change must always use the EARLIER (base/previous) year as denominator, never the later year — a very common scoring error.

Common Mistakes

1Computing percentage change using the current year as the denominator instead of the base (earlier) year.
2Forgetting to show a negative sign/bracket for decreases (like Inventories falling by 50%).
3Not tallying the totals of Equity & Liabilities with Assets after computing changes, missing an arithmetic slip.

Interesting Facts

Comparative statements are a form of 'horizontal analysis', contrasted with common-size statements which perform 'vertical analysis'.

A uniform 20% growth across almost all Equity & Liabilities items, as seen here, often indicates planned, proportionate expansion rather than distress financing.

Falling inventories alongside rising sales-supporting assets can indicate a shift toward just-in-time inventory management, a real corporate finance trend.

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Frequently Asked Questions

What is the formula for percentage change in a Comparative Balance Sheet?

$\text{Percentage Change} = (\text{Current Year Amount} - \text{Previous Year Amount}) \div \text{Previous Year Amount} \times 100$ , always using the earlier year as the base.

Why did the percentage change for Cash & Cash equivalents come to 66.67% and not a round number?

Because the absolute increase of Rs. 4,00,000 is divided by the 2024 base of Rs. 6,00,000, giving 66.67% — the base year amount, not the final year, always determines the percentage.