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✦ FREE LEARNING — CLASS 11 & 12 — CBSE · PSEB — ACCOUNTS · ECONOMICS · BST ✦
Question 118 Chapter 4 of +2-B
Miscellaneous (Analytical Questions)
118. (Calculation of Opening Inventory & Closing Inventory) Calculate the amount of opening stock and closing stock from the following figures:-
Average Debt Collection period 4 months; Inventory Turnover ratio 3 times, Average Trade Receivable ₹ 1,00,000; cash sales being 25% of total sales; Gross profit ratio 25% Inventory at the end was 3 times more than that in the beginning.
|
Average Debt Collection Period |
= | No. of working days |
| Debtors Turnover Ratio | ||
| 4 | = | 12 Months |
| Debtors Turnover Ratio | ||
| Debtors Turnover Ratio | = | 12 |
| 4 | ||
| = | 3 times |
| Debtors Turnover Ratio | = | Net Credit Sales |
| Average Debtors | ||
| 3 | = | Net Credit Sales |
| ₹ 1,00,000 | ||
| Net Credit Sales | = | 3 x 1,00,000 |
| = | ₹ 3,00,000 | |
| Let Assume Total Sales | = | ₹ 1 |
| Cash Sales | = | 1 |
| 4 |
|
(i) Return on investment Ratio |
= | ₹ 1 | - | 1 |
| 4 | ||||
| = | 3 | |||
| 4 | ||||
| Total Sales | = | 3 | X | x ₹ 3,00,000 |
| 4 | ||||
| = | ₹ 4,00,000 | |||
| Cost of goods sold | = | Sales – Gross Profit | ||
| = | ₹ 4,00,000 – 25% | |||
| = | ₹ 4,00,000 – ₹ 1,00,000 | |||
| = | ₹ 3,00,000 | |||
| Inventory Turnover Ratio | = | Cost of goods sold | ||
| Average Inventory | ||||
| 3 | = | ₹ 3,00,000 | ||
| Average Inventory | ||||
| Average Inventory | = | ₹ 3,00,000 | ||
| 3 | ||||
| = | ₹ 1,00,000 | |||
| Average Inventory | = | Opening Stock + Closing Stock | ||
| 2 | ||||
| ₹ 1,00,000 x 2 | = | Opening Stock + Closing Stock | ||
| = | ₹ 2,00,000 | |||
| Opening Stock | = | ₹ 1 | ||
| Closing Stock | = | ₹ 3 | ||
| Total Stock | = | 1 + 3 | ||
| = | 4 | |||
| Opening Stock | = | ₹ 2,00,000 | X | 1 |
| 4 | ||||
| = | ₹ 50,000 | |||
| Closing Stock | = | ₹ 1,00,000 | X | 3 |
| 4 | ||||
| = | ₹ 1,50,000 |
Accounting & Commerce Educator
Sarbjit Singh holds a B.Com and M.Com degree and has over 12 years of teaching experience in double entry bookkeeping, financial accounting, and business studies.
This guide covers "Question 118 Chapter 4 of +2-B - USHA Publication 12 Class", focusing on key definitions, step-by-step concepts, applications, and revision guidelines relevant to USHA Publication Part 2 volume I.
It is primarily curated for Class 11 and Class 12 high school commerce, accounting, and economics students, as well as aspirants preparing for board exams or CA Foundation.
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