n NISM Certifications
XV NISM Series XV
Medium

Equity Capital = ₹5,00,000, ROE = 25%, Net Profit Margin = 20%. Calculate Sales.

Practice question from NISM XV Mock Test 4 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    ₹4,25,000

  2. B

    ₹4,50,000

  3. C

    ₹5,00,000

  4. ₹6,25,000

    Correct answer

Why this is the answer

Net Profit = ROE × Equity = 25% × 5,00,000 = 1,25,000. Sales = Net Profit ÷ Net Profit Margin = 1,25,000 ÷ 0.2 = 6,25,000.

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