Question 118 Chapter 4 of +2-B – USHA Publication 12 Class

Question 118 Chapter 4 of +2-B

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.

 

The solution of Question 118 Chapter 4 of +2-B: – 

 

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    

 


Also, Check out the solved question of previous Chapters: –

Usha Publication – Accountancy PSEB (Class 12) – Volume I – Solution

Usha Publication – Accountancy PSEB (Class 12) – Volume II – Solution

Check out T.S. Grewal +2 Book 2020@ Official Website of Sultan Chand Publication

2 Book 3 min 225x300 - Question 118 Chapter 4 of +2-B  - USHA Publication  12 Class
T.S. Grewal’s Analysis of Financial Statements

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