following figures have been extracted from misba mills ltd. stock at the end of the year 1,50,000,stock at the begining of the year 90,000 .stock turnover ratio is 8 times, selling price 25 percent above cost. compute the amount of gross profit and sales.
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Answer:
stock turnover ratio =
cost of goods sold/ average stock
average stock = opening +closing/2
= 150000+90000/2
=120000
8=. cost of good sold/120000
cost of good sold = 120000×8
=960000
given that selling price 25% above cost
gross profit = 960000×25%
= 240000
selling price = cost + gross profit
= 960000+240000
=1200000
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