Calculate stock turnover ratio from the following information of ‘L�

1.	Calculate stock turnover ratio from the following information of ‘L’ Company Limited :Particulars(₹)Particulars(₹)Sales30,00,000Opening stock3,50,000Closing stock2,50,000Purchases12,00,000Gross profit rate30%
Answer» Cost of goods sold = Sales – Gross Profit (@ 30%) = ₹ 30,00,000 – ₹ 9,00,000 = ₹ 21,00,000 Average Stock = \( \frac{Opening\, stock + Closing\, stock} {2} = \frac{3,50,000+2,50,000}{2}\) = ₹ 3,00,000 Stock Turnover = \(\frac{Cost\, of\, goods\, sold} {Average\, stock} =\frac{21,00,000}{3,00,000}\) = 7 times

Calculate stock turnover ratio from the following information of ‘L’ Company Limited :Particulars(₹)Particulars(₹)Sales30,00,000Opening stock3,50,000Closing stock2,50,000Purchases12,00,000Gross profit rate30%

Answer»

Cost of goods sold = Sales – Gross Profit (@ 30%)

= ₹ 30,00,000 – ₹ 9,00,000 = ₹ 21,00,000

Average Stock = \( \frac{Opening\, stock + Closing\, stock} {2} = \frac{3,50,000+2,50,000}{2}\) = ₹ 3,00,000

Stock Turnover = \(\frac{Cost\, of\, goods\, sold} {Average\, stock} =\frac{21,00,000}{3,00,000}\) = 7 times