Question

Calculate opening stock and closing stock if given cost of goods sold 360000 and inventory turnover ratio 5 times .stock at the beginning is 2.5 times more than stock at the end

Answer 1

Answer:

Opening Stock - 11,20,000

Closing Stock   -  3,20,000

Explanation:

ITR = COGS / Average Inventory

So, as per question    ITR =5    COGS = 3,60,000  AI = ? ( We have to find )

     5 =   3,60,000 / AI

    ⇒ AI =  7,20,000

AI formula = Opening Stock + Closing Stock / 2

7,20,000 x 2 = OS + CS                                              CS =  x

14,40,000      = OS + CS                                              OS = 2.5x + x ( 2.5 times  

14,40,000     = (2.5x + x ) + x                                        + more than the stock )                                                                                                                                              

So, x  (CS) =  3,20,000

         (OS) =  11,20,000