Question

Revenue from Operations ₹ 2,00,000; Inventory Turnover Ratio 5; Gross Profit 25%. Find out the value of Closing Inventory, if Closing Inventory is ₹ 8,000 more than the Opening Inventory.

पर्याय

• ₹ 38,000

• ₹ 22,000

• ₹ 34,000

• ₹ 26,000

Answer 1

₹ 34,000

Explanation:

Cost of Revenue from Operation = Revenue from Operation − Gross Profit

= 2,00,000 − 25,100 ×2,00,000

= 2,00,000 − 50,000

= ₹ 1,50,000

Inventory Turnover Ratio = `"Cost of Revenue from Operations"/"Average Inventory"`

5 = `(1,50,000)/"Average Inventory"`

Average Inventory = `(1,50,000)/5`

= ₹ 30,000

Let the Opening Inventory be x.

Closing Inventory = `x` + 8,000

Average Inventory = `("Opening Inventory" + "Closing Inventory")/2`

30,000 = `(x + x + 8,000)/2`

30,000 × 2 = x + x + 8,000

60,000 = `2x + 8,000`

`2x` = 60,000 − 8,000

`2x` = 52,000

Opening Inventory `(x)` = ₹ 26,000

Closing Inventory = Opening Inventory + 8,000

= 26,000 + 8,000

= ₹ 34,000