Question

Goods purchased Rs. 1, 00,000. Sales 90,000. Margin 20 % on sales. Closing stock
is

a. Rs. 10,000

b. Rs. 25,000

c. Rs. 28,000

d. None of the above​

Answer 1

$\huge\bold{Question}$

Goods purchased Rs. 1, 00,000. Sales 90,000. Margin 20 % on sales. Closing stock

is

a. Rs. 10,000

b. Rs. 25,000

c. Rs. 28,000

d. None of the above

$\huge\bold{Answer}$

The closing Inventory is 25,000

$\sf\bold\color{green}{Given}$

Purchase price = 1,00,000

Sales = 90000 (Including profit of 20% on cost)

Solution:

Cost of goods sold = Sales - (Sale price % - Profit on sale %)

Cost of goods sold = 90,000 -$\left (90,000 \times \frac{1}{6} \right)$ = 75000

Therefore, Closing inventory = Purchase - Cost of goods sold

Thus, we get,

Closing Inventory = 1,00,000 - 75000 = 25,000

Profit on sale % = 20% profit on cost = 25% profit on sale

$\sf\bold\color{Red}{Option}$

b. Rs. 25,000