# Question 37 Chapter 4 of +2-B – USHA Publication 12 Class Q-37- CH-4 Book 2 - Usha Pub. +2 Book 2020 - Solution

Question 37 Chapter 4 of +2-B

37. (Inventory T/O Ratio/Sales, Returns, GP rate given) From the following details, calculate
inventory turnover.
Opening Inventory ₹ 31,000 Closing inventory ₹ 39,000, Credit Sales (Revenue from Operation) ₹ 1,00,000
Cash Sales (Revenue from Operations) 2,00,000 Returns inwards 10,000. Gross Profit Ratio 20%.

## The solution of Question 37 Chapter 4 of +2-B: –

 Inventory Turnover Ratio = Cost of goods sold Average Inventory
 Cost of goods sold = Net Total Sales – Gross profit = Cash Sales + Credit Sales – Sales Return = ₹ 2,00,000 + ₹ 1,00,000 – ₹ 10,000 = ₹ 2,90,000 Gross profit = 20% of Net Total Sales Net Total Sales = ₹ 2,90,000
 Gross profit = ₹ 2,90,000 x X 20 100 = ₹ 58,000

 Cost of goods sold = Net Total Sales – Gross profit = ₹ 2,90,000 – ₹ 58,000 = ₹ 2,32,000
 Debt Equity Ratio = Opening Inventory – Closing Inventory 2 = ₹ 31,000 – ₹ 39,000 2 = ₹ 35,000

 Inventory Turnover Ratio = ₹ 2,32,000 ₹ 35,000 = 6.62 Times

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