Calculate Revenue from operation of XYZ ltd from the following information
Current Assets Rs 800,000
Quick Ratio 1.5 : 1
Current Ratio 2: 1
Inventory Turnover Ratio 6 times
Goods were sold at profit of 25% on cost
Answers
Answered by
6
Answer:
current liability= 800,000/2
= 400,000
quick assest = 400,000*1.5=600,000
Inventory= 800,000-600,000=200,000
Inventory Turnover Ratio=Cost of Goods Sold/Average Stock
6 = Cost of Goods Sold/200,000
Cost of Goods Sold = 6 * 200,000
= Rs. 1,200,000
Gross Profit = 1,200,000 * 25/100
= Rs. 300,000
Revenue from Operations = Cost of Goods Sold + Gross Profit= 1,200,000 + 300,000
= Rs. 1,500,000.
Similar questions