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The total cost of goods available for sale with a company during the current year is Rs.12,00,000 and the total sales during the period are Rs.13,00,000. If the gross profit of the company is 33 1/3% on cost, the closing inventory during the current year will be: (a) 4,00,000 (b) 3,00,000 (c) 2,25,000 (d) 2,60,000?
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The total cost of goods available for sale with a company during the c...
The Closing Inventory Calculation:

To calculate the closing inventory, we need to determine the cost of goods sold (COGS) first. Then, we can subtract the COGS from the total cost of goods available for sale to find the closing inventory.

Step 1: Calculate the Cost of Goods Sold (COGS):

COGS can be calculated using the following formula:

COGS = Total Cost of Goods Available for Sale - Gross Profit

Given:
Total Cost of Goods Available for Sale = Rs.12,00,000
Gross Profit = 33 1/3% on Cost

To calculate the Gross Profit, we can use the following formula:

Gross Profit = (Gross Profit Percentage / 100) * Cost

Given:
Gross Profit Percentage = 33 1/3%
Cost = Total Cost of Goods Available for Sale

Substituting the given values:
Gross Profit = (33 1/3 / 100) * Rs.12,00,000
= (1/3 * 12,00,000)
= Rs.4,00,000

Now, we can calculate the COGS:
COGS = Rs.12,00,000 - Rs.4,00,000
= Rs.8,00,000

Step 2: Calculate the Closing Inventory:

Closing Inventory can be calculated using the following formula:

Closing Inventory = Total Cost of Goods Available for Sale - COGS

Given:
Total Cost of Goods Available for Sale = Rs.12,00,000
COGS = Rs.8,00,000

Substituting the given values:
Closing Inventory = Rs.12,00,000 - Rs.8,00,000
= Rs.4,00,000

Therefore, the closing inventory during the current year will be Rs.4,00,000.

Final Answer:

The correct option is (a) 4,00,000.
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The total cost of goods available for sale with a company during the current year is Rs.12,00,000 and the total sales during the period are Rs.13,00,000. If the gross profit of the company is 33 1/3% on cost, the closing inventory during the current year will be: (a) 4,00,000 (b) 3,00,000 (c) 2,25,000 (d) 2,60,000?
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The total cost of goods available for sale with a company during the current year is Rs.12,00,000 and the total sales during the period are Rs.13,00,000. If the gross profit of the company is 33 1/3% on cost, the closing inventory during the current year will be: (a) 4,00,000 (b) 3,00,000 (c) 2,25,000 (d) 2,60,000? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about The total cost of goods available for sale with a company during the current year is Rs.12,00,000 and the total sales during the period are Rs.13,00,000. If the gross profit of the company is 33 1/3% on cost, the closing inventory during the current year will be: (a) 4,00,000 (b) 3,00,000 (c) 2,25,000 (d) 2,60,000? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for The total cost of goods available for sale with a company during the current year is Rs.12,00,000 and the total sales during the period are Rs.13,00,000. If the gross profit of the company is 33 1/3% on cost, the closing inventory during the current year will be: (a) 4,00,000 (b) 3,00,000 (c) 2,25,000 (d) 2,60,000?.
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