Calculate Inventory Turnover Ratio from the data given Below-Carriage Inwards-Revenue from Operations- i-e- Sales - Inventory in the beginning of the year - Inventory at the end of the year 20-000- Purchases 10-000- 50-000 -State the significance of this ratio-

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Standard XII

Accountancy

Stationary/ Food Supplies

Calculate Inv...

Question

Calculate Inventory Turnover Ratio from the data given Below:

₹ ₹

Inventory in the beginning of the year 20,000 Carriage Inwards 5,000

Inventory at the end of the year 10,000 Revenue from Operations, i.e., Sales 1,00,000

Purchases 50,000

State the significance of this ratio.

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Solution

Cost of Goods Sold = Opening Stock + Purchases + Carriage Inwards − Closing Stock

= 20,000 + 50,000 + 5,000 − 10,000 = 65,000

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	₹		₹
Inventory in the beginning of the year	20,000	Carriage Inwards	5,000
Inventory at the end of the year	10,000	Revenue from Operations, i.e., Sales	1,00,000
Purchases	50,000

Calculate Inventory Turnover Ratio from the data given Below: ₹ ₹ Inventory in the beginning of the year 20,000 Carriage Inwards 5,000 Inventory at the end of the year 10,000 Revenue from Operations, i.e., Sales 1,00,000 Purchases 50,000 State the significance of this ratio.

Cost of Goods Sold = Opening Stock + Purchases + Carriage Inwards − Closing Stock = 20,000 + 50,000 + 5,000 − 10,000 = 65,000

Calculate Inventory Turnover Ratio from the data given Below:

₹ ₹

Inventory in the beginning of the year 20,000 Carriage Inwards 5,000

Inventory at the end of the year 10,000 Revenue from Operations, i.e., Sales 1,00,000

Purchases 50,000

State the significance of this ratio.

Cost of Goods Sold = Opening Stock + Purchases + Carriage Inwards − Closing Stock

= 20,000 + 50,000 + 5,000 − 10,000 = 65,000