Question

1. Calculate Inventory Turnover Ratio:
Sales 4,00,000, Average Stock 55,000, Gross Loss Ratio 10%​

Answer 1

$\sf\red{Inventory \: Turnover \: ratio = \frac{Cost \: of \: revenue \: from \: operations}{Average \: inventory} }$

$\implies$$\sf{\frac{4,40,000}{55,000} }$

$\implies$$\sf{8 \: times}$

WORKING NOTE:

$\sf\red{Net \: sales = ₹4,00,000}$

$\sf\red{Gross\: Loss = 10\% \: of \: 4,00,000 = ₹40,000}$

$\sf\red{Cost\:of \:revenue \: from\: operations=Net\:sales +Gross \: loss}$

$\implies$$\sf{4,00,000+40,000}$

$\implies$$\sf{4,40,000}$