Question

Calculate the value of Closing Stock from the following information:

	₹
Purchases	93,000
Wages	20,000
Sales	1,20,000
Carriage Outwards	3,200
Opening Stock	16,000
Rate of Gross Profit 25% on Cost.

Answer 1

Rate of Gross Profit on Cost = 1/4
Rate of Gross Profit on Sale = 1/5
Gross Profit = ₹ 24,000 (1/5 of 1,20,000)
Cost of Goods Sold = Net Sales – Gross Profit
Cost of Goods Sold = 1,20,000 – 24,000 = ₹ 96,000
Cost of Goods Sold = Opening Stock + Purchases + Direct Expenses – Closing Stock
96,000 = 16,000 + 93,000 + 20,000 – Closing Stock
Closing Stock = ₹ 33,000