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=3Xx ₹ 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 X1
 4
 =₹ 50,000  
Closing Stock=₹ 1,00,000 X3
 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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