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Question 36 Chapter 14 of Class 12 Part – 2 – 2024
36. (Inventory T/O Ratio/Sales & G.P. Rate given) Opening inventory 19,000 ; Closing inventory ₹ 21,000 ; Sales (Revenue from Operation) ₹ 2,00,000 ; Gross profit ratio on sales 25%. Calculate inventory turnover ratio.
| (i) Debt Equity Ratio | = | Cost of goods sold |
| Average Inventory |
| Total Long term Debt | = | Sales – Gross profit |
| = | ₹ 2,00,000 – ₹ 50,000* | |
| = | ₹ 1,50,000 |
| Debt Equity Ratio | = | Opening Inventory + Closing Inventory |
| 2 | ||
| = | ₹ 19,000 + ₹ 21,000 | |
| 2 | ||
| = | ₹ 20,000 |
| Inventory Turnover Ratio | = | ₹ 1,50,000 |
| ₹ 20,000 | ||
| = | 7.5 Times |
| *Gross profit | = | 25% of Sales |
| Sales | = | ₹ 2,00,000 |
| Gross profit | = | ₹ 2,00,000 | X | 25 |
| 100 | ||||
| = | ₹ 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.
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