A Trader carries an Average Inventory of 1,00,000. His Inventory Turnover Ratio is 8 Times. He sells
goods at a profit of 25%

A Trader carries an Average Inventory of 1,00,000. His Inventory Turnover Ratio is 8 Times. He sells
goods at a profit of 25% of cost. Calculate Gross Profit Ratio.

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2 thoughts on “A Trader carries an Average Inventory of 1,00,000. His Inventory Turnover Ratio is 8 Times. He sells<br />goods at a profit of 25%”

  1. [tex]\begin{gathered}{\Huge{\textsf{\textbf{\underline{\underline{\purple{Answer:}}}}}}}\end{gathered}[/tex]

    [tex]\implies[/tex]inventory turnover = cost of goods sold / average inventory

    8-cost of goods sold /40000

    cost of goods sold =320000

    profit of 20% on sales

    therefore profit of 25% on cost of goods sold

    therefore gross profit = 320000*25%

    = 80000

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