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Calculate Inventory Turnover Ratio from the following information:Opening Inventory ₹ 40,000; Purchases ₹ 3,20,000; and Closing Inventory ₹ 1,20,000.State, giving reason, which of the following transactions would (i) increase, (ii) decrease, (iii) neither increase nor decrease the Inventory Turnover Ratio:(a) Sale of goods for ₹ 40,000 (Cost ₹ 32,000).(b) increase in the value of Closing Inventory by ₹ 40,000.(c) Goods purchased for ₹ 80,000.(d) Purchases Return ₹ 20,000.(e) goods costing ₹ 10,000 withdrawn for personal use.(f) Goods costing ₹ 20,000 distributed as free samples. |
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Answer» Calculate Inventory Turnover Ratio from the following information: Opening Inventory ₹ 40,000; Purchases ₹ 3,20,000; and Closing Inventory ₹ 1,20,000. State, giving reason, which of the following transactions would (i) increase, (ii) decrease, (iii) neither increase nor decrease the Inventory Turnover Ratio: (a) Sale of goods for ₹ 40,000 (Cost ₹ 32,000). (b) increase in the value of Closing Inventory by ₹ 40,000. (c) Goods purchased for ₹ 80,000. (d) Purchases Return ₹ 20,000. (e) goods costing ₹ 10,000 withdrawn for personal use. (f) Goods costing ₹ 20,000 distributed as free samples. |
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