Calculate Stock Turnover Ratio if Opening Stock is Rs. 76,250, Closing Stock is Rs. 98,500, Sales is Rs. 5,20,000, Sales Return is Rs. 20,000, Purchase is Rs. 3,22,250.

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Solution

$S t o c k T u r n o v e r R a t i o = \frac{C o s t o f G o o d s S o l d}{A v e r a g e S t o c k}$

$C o s t o f G o o d s S o l d$
$= O p e n i n g S t o c k + P u r c h a s e s - C l o s i n g S t o c k$
$= R s . 76, 250 + R s . 3, 22, 250 - R s . 98, 500 = R s . 3, 00, 000$

$A v e r a g e S t o c k$
$= \frac{O p e n i n g S t o c k + C l o s i n g S t o c k}{2}$
$= \frac{R s . 76, 250 + R s . 98, 500}{2} = R s . 87, 375$

$S t o c k T u r n o v e r R a t i o$
$= \frac{R s . 3, 00, 000}{R s . 87, 375} = 3.43 t i m e s$

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