Question

Calculate value of opening stock from the following.
Question gave in photo ​

Answer 1

Question :

Calculate value of opening stock from the following.

Cash Sales = Rs. 40,000

Credit Sales = Rs. 1,65,000

Sale Return (Out of Credit Sales) = Rs. 5,000

Purchases = Rs. 1,24,000

Purchase Return = Rs. 4,000

Carriage Inwards = Rs. 8,000

Closing Stock = Rs. 36,000

Rate of Gross Profit = 40% on Sales

Explanation:

Solution :

★ Total Net Sales = (Cash Sales + Credit Sales) - Sales Return

⇒ (40,000 + 1,65,000) - 5,000

⇒ 2,00,000

Net Sales = Rs 2,00,000

★ Gross Profit 40 % on sales :

⇒ 40 % of 2,00,000

⇒ 80,000

Gross Profit = Rs 80,000

• As we know ,

★ Gross Profit = Net Sales - Cost of Goods Sold

⇒ 80,000 = 2,00,000 - Cost of Goods Sold

⇒ Cost of Goods Sold = 2,00,000 - 80,000

⇒ Cost of Goods Sold = 1,20,000

Cost of Goods Sold = Rs 1,20,000

★ Cost of Goods Sold = Opening Stock + (Purchases - Purchase Return) + Carriage Inwards - Closing Stock

⇒ 1,20,000 = Opening Stock + (1,24,000 - 4,000) + 8,000 - 36,000

⇒ 1,20,000 = Opening Stock + 1,20,000 + 8,000 - 36,000

⇒ 1,20,000 = Opening Stock + 92,000

⇒ 1,20,000 - 92,000 = Opening Stock

⇒ 28,000 = Opening Stock

⇒ Opening Stock = Rs 28,000

Therefore,

The value of Opening Stock is Rs 28,000