Question

Cost of Revenue from Operations = ₹3,00,000
Inventory Turnover Ratio = 6 times
Find out the value of Opening Inventory, if opening inventory is ₹10,000 less than the closing
inventory.
[Ans. 45,000]



Please solve it Fast

Answer 1

Explanation:

Inventory Turnover Ratio = COGS/ Average Inventory

=> 6 = 3,00,000/ Average Inventory

=> Average Inventory =3,00,000/6

=> Average Inventory = 50,000

Average Inventory= opening Inventory+ Closing Inventory/2

Suppose, opening Inventory= x

closing Inventory = x +10

=> 50,000= x +( x+10,000)/2

=> 1,00,000 = 2x +10,000

=> 2x = 1,00,000 - 10,000

=> x= 90,000/2

=> x = 45,000

opening Inventory= ₹ 45,000

Hence, opening Inventory= ₹ 45,000

Answer 2

Answer:

the value of Opening Inventory = Rs 45,000

Explanation:

Solution :

The Stock Turnover Ratio :

$\sf{\longrightarrow{\dfrac{Cost \: of \: Revenue \: from \: Operation}{Average \: Inventory}}}$

$\sf{\longrightarrow \: 6 \: = \: {\dfrac{3,00,000}{Average \: Inventory}}}$

★ Average Inventory =

$\sf{\longrightarrow{\dfrac{3,00,000}{6}}} \: = \: 50000$

Average Inventory = 50,000

★ Average Inventory =

$\sf{\longrightarrow {\dfrac{Ope.ning \: Stock \: + \: Closing \: Stock}{2}}}$

Let,

Closing Inventory = x

Opening Inventory = x - 10,000

$\sf{\longrightarrow \: 50000 \: = \: {\dfrac{(x\:-\:10,000) \: + \: x}{2}}}$

$\longrightarrow$ 50,000 × 2 = 2x - 10,000

$\longrightarrow$ 1,00,000 = 2x - 10,000

$\longrightarrow$ 1,00,000 + 10,000 = 2x

$\longrightarrow$ 1,10,000 = 2x

$\longrightarrow$ x = 1,10,000/2

$\longrightarrow$ x = 55,000

Closing Inventory = Rs. 55,000

Opening Inventory = x - 10,000

$\longrightarrow$ 55,000 - 10,000

$\longrightarrow$ 45,000

Opening Inventory = Rs 45,000

Therefore, the value of Opening Inventory = Rs 45,000