Which of the following transaction will affect the 'Gross Profit Ratio' of a company :

(i) Revenue from operations Rs. 1,00,000

(ii) Purchased goods worth Rs. 70,000.

(iii) Goods costing Rs. 15,000 withdrawn for personal use.

(iv) Goods costing Rs. 50,000 sold for Rs. 60,000.

Concept: $\text{Gross Profit Ratio} = (\text{Gross Profit} \div \text{Net Revenue from Operations}) \times 100$. Only an event that changes Gross Profit or Revenue from Operations (or both) can change this ratio.

Why (iv) is correct: Selling goods costing Rs. 50,000 for Rs. 60,000 is an actual sale — it adds Rs. 60,000 to Revenue from Operations and Rs. 50,000 to Cost of Revenue from Operations, creating a fresh Rs. 10,000 of gross profit. Both the numerator and denominator move, so the ratio necessarily changes.

Why the others don't count:

• (i) merely restates the Revenue from Operations figure already earned — it is base data, not a new transaction that alters gross profit.
• (ii) a purchase of Rs. 70,000 that remains unsold is matched by an equal increase in closing stock, so Cost of Goods Sold — and hence Gross Profit — is unaffected.
• (iii) goods withdrawn for personal use are excluded from Cost of Goods Sold as a routine adjustment (Adjusted Purchases = Purchases − Drawings); this is a correction to arrive at the true COGS, not a fresh trading transaction that shifts the ratio.

Exam trap: Students often assume 'more cost items = more impact', but only a genuine trading transaction that moves both Sales and COGS actually shifts the Gross Profit Ratio.