Question

cash revenue from operation 100000 ,credit revenue from operation 200000,gross profit 50000 ,inventory turnover ratio 5 times calculate the opening and closing inventory if the closing was twice that in the opening​

Answer 1

Answer:

opening inventory= 33,333/-

and closing inventory= 66,667/-

Answer 2

Answer:

Hope this answer may help you . please let me know this in the comments

Explanation:

Inventory Turnover Ratio=

Cost revenue from operation

Average Inventory

Cost of revenue from Operation =

Credit revenue from operations + cash revenue from operations

=2,00,000+1,00,000

=3,00,000

Inventory Turnover Ratio=

cost_of_revenue_from_operation

average inventory

5= 3,00,000

average inventory

Average inventory = 3,00,000

5

= 60,000

average inventory =

closing_inventory_+_opening_inventory

2

* It is given tant closing inventory inventory is twice the opening inventory

so if we let opening inventory be a

then closing inventory = 2a

Average inventory = 2a_+_a

2

60,000 = 3a

2

3a = 60,000 X 2

a = 1,20,000 = 40,000

3

So, opening inventory = a =40,000

and closing inventory =2a = 40,000 X 2

= 80,000