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Calculate inventory turnover ratio: Opening stock = Rs. 30,000; Closing stock = Rs. 50,000; Purchases = Rs. 1,20,000 |
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Answer» Inventory turn over ratio = (Cost of revenue form operations)/(Average inventory) Cost of revenue form operations = Opening stock + purchase - closing inventory = 30,000 + 1,20,000 - 50,000 = Rs. 1,00,000 Average inventory = (Opening inventory + Closing inventory)/2 = (30,000 + 50,000)/2 = 80,000/2 Rs. = 40,000 Inventory turn over ratio = 1,00,000/40,000 = 2.5 times |
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