Question

From the following details calculate Net Purchases of Universal Ltd.
Opening stock =50,000
Manufacturing expenses = 30,000
Selling and distribution expenses =Rs. 20,000
Administrative expenses =Rs. 10,000
Financial expenses =Rs. 5,000
Closing stock Rs. 25,000
Sales Rs. 2,40,00
Gross profit on sale 25 %

• A. Rs. 1,20,000
• B. Rs. 95,000
• C. Rs. 1,25,000
• D. Rs. 85,000

Answer 1

The correct option is C Rs. 1,25,000

Solution to the given problem is as under:

Trading Account

Particuars Amount Particulars Amount

To Opening Stock 50000 By Sales 240000

To Manufacturing Exp 30000 By Closing Stock 25000

To Purchases (Balancing) 125000

To Gross Profit 60000

(25% of Sales)

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265000 265000

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