Invoice Price Calculation for Consignment Goods

Introduction
When goods are sent on consignment, the consignor retains the ownership of the goods until they are sold by the consignee. The consignor sends the goods to the consignee at the cost price, and the consignee sells the goods at a higher price to make a profit. The invoice price of the goods is calculated on the basis of the cost price and the agreed upon profit margin.

Cost of Goods Sent to Consignee
The cost of goods sent to the consignee is Rs 2,00,000. This is the cost price of the goods, which includes the cost of production, transportation, and other expenses incurred by the consignor.

Profit Margin
The profit margin for the consignee is 25%, which means that the consignee will sell the goods at a price that is 25% higher than the cost price.

Calculation of Invoice Price
To calculate the invoice price of the goods, we need to add the profit margin to the cost price. The formula for calculating the invoice price is:

Invoice Price = Cost Price + Profit Margin

Substituting the values, we get:

Invoice Price = Rs 2,00,000 + (25% of Rs 2,00,000)
Invoice Price = Rs 2,00,000 + Rs 50,000
Invoice Price = Rs 2,50,000

Conclusion
The invoice price of the goods sent to the consignee is Rs 2,50,000. This includes the cost price of Rs 2,00,000 and a profit margin of Rs 50,000, which is 25% of the cost price. The consignee will sell the goods at this price to make a profit.

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