Calculate Inventory Turnover Ratio if: Inventory in the beginning is Rs. 76,250, Inventory at the end is 98,500, Gross Revenue from Operations is Rs. 5,20,000:- ACCOUNTING RATIOS
Calculate Inventory Turnover Ratio if:
Inventory in the beginning is Rs. 76,250, Inventory at the end is 98,500, Gross Revenue from Operations is Rs. 5,20,000, Sales Return is Rs. 20,000, Purchases is Rs. 3,22,250.
Inventory Turnover Ratio

Cost of Revenue from Operations = Inventory in Begining + Purchase - Inventory at the end
= 76,250 + 3,22,250 - 98,500
= 3,00,000
Average Inventory
= `\frac{72,250 + 98,000}{2 } `
= 87,375
Inventory Turn Over Ratio = `\frac{3,00,000}{87,375 } ` = 3.43 times
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