A) Calculate Gross profit :ParticularOpening Inventory80,000Closing Inventory100 000revenue from opreating 900.000inventory turnover ratio 8 time. About the author Ella
Explanation: Inventory turnover ratio = COGS / Average Inventory 8 = COGS / Average Inventory Average Inventory = Opening Inventory + Closing Inventory/2 = 80,000 + 1,00,000/2 = 1,80,000/2 = 90,000 Average Inventory = 90,000 Inventory turnover ratio = COGS / Average Inventory 8 = COGS / 90,000 COGS = 7,20,000 Gross profit = Net sales – COGS Gross profit = 9,00,000 – 7,20,000 Gross profit = 1,80,000 Therefore, Gross profit = Rs. 1,80,000 Reply
Answer: Gross Profit = Rs. 1,80,000 Explanation: Given : Opening Inventory = 80,000 Closing Inventory = 1,00,000 Revenue from opreatins = 9,00,000 inventory turnover ratio = 8 times Gross profit = ?? Solution : Gross Profit = Revenue from opreations – Cost of Revenue from opreations Inventory Turnover Ratio : [tex]\sf{\longrightarrow{\dfrac{Cost \: of \: Revenue \: from \: opreations}{Average \: Inventory}}}[/tex] [tex]\sf{\longrightarrow{\dfrac{Cost \: of \: Revenue \: from \: opreations}{ \frac{Ope.ning \: Inventory \: + \: Closing \: Inventory}{2}}}}[/tex] ★ Average Inventory = [tex]\sf{\longrightarrow{\dfrac{Ope.ning \: Inventory \: + \: Closing \: Inventory}{2}}}[/tex] [tex]\sf{\longrightarrow{\dfrac{80,000 \: + \: 1,00,000}{2}}}[/tex] [tex]\longrightarrow \:90,000[/tex] Average Inventory = 90,000 Inventory Turnover Ratio : [tex]\sf{\longrightarrow{\dfrac{Cost \: of \: Revenue \: from \: opreations}{Average \: Inventory}}}[/tex] [tex]\sf{\longrightarrow \: 8 \: = \: {\dfrac{Cost \: of \: Revenue \: from \: opreations}{90,000}}}[/tex] Cost of Revenue from opreations = 90,000 × 8 Cost of Revenue from opreations = 7,20,000 Gross Profit = Revenue from opreations – Cost of Revenue from opreations Gross Profit = 9,00,000 – 7,20,000 Gross Profit = 1,80,000 Therefore, Gross Profit = Rs. 1,80,000 Reply
Explanation:
Inventory turnover ratio = COGS / Average Inventory
8 = COGS / Average Inventory
Average Inventory = Opening Inventory + Closing Inventory/2
= 80,000 + 1,00,000/2
= 1,80,000/2
= 90,000
Average Inventory = 90,000
Inventory turnover ratio = COGS / Average Inventory
8 = COGS / 90,000
COGS = 7,20,000
Gross profit = Net sales – COGS
Gross profit = 9,00,000 – 7,20,000
Gross profit = 1,80,000
Therefore, Gross profit = Rs. 1,80,000
Answer:
Gross Profit = Rs. 1,80,000
Explanation:
Given :
Opening Inventory = 80,000
Closing Inventory = 1,00,000
Revenue from opreatins = 9,00,000
inventory turnover ratio = 8 times
Gross profit = ??
Solution :
Gross Profit = Revenue from opreations – Cost of Revenue from opreations
Inventory Turnover Ratio :
[tex]\sf{\longrightarrow{\dfrac{Cost \: of \: Revenue \: from \: opreations}{Average \: Inventory}}}[/tex]
[tex]\sf{\longrightarrow{\dfrac{Cost \: of \: Revenue \: from \: opreations}{ \frac{Ope.ning \: Inventory \: + \: Closing \: Inventory}{2}}}}[/tex]
★ Average Inventory =
[tex]\sf{\longrightarrow{\dfrac{Ope.ning \: Inventory \: + \: Closing \: Inventory}{2}}}[/tex]
[tex]\sf{\longrightarrow{\dfrac{80,000 \: + \: 1,00,000}{2}}}[/tex]
[tex]\longrightarrow \:90,000[/tex]
Average Inventory = 90,000
Inventory Turnover Ratio :
[tex]\sf{\longrightarrow{\dfrac{Cost \: of \: Revenue \: from \: opreations}{Average \: Inventory}}}[/tex]
[tex]\sf{\longrightarrow \: 8 \: = \: {\dfrac{Cost \: of \: Revenue \: from \: opreations}{90,000}}}[/tex]
Cost of Revenue from opreations = 90,000 × 8
Cost of Revenue from opreations = 7,20,000
Gross Profit = Revenue from opreations – Cost of Revenue from opreations
Gross Profit = 9,00,000 – 7,20,000
Gross Profit = 1,80,000
Therefore, Gross Profit = Rs. 1,80,000