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Goods purchased Rs. 1,00,000. Sales Rs. 90,000. Margin 20% on cost. Closing Inventory =?
- a)Rs.20,000
- b)Rs.10,000
- c)Rs.25,000
- d)Rs.28,000
Correct answer is option 'C'. Can you explain this answer?
Verified Answer
Goods purchased Rs. 1,00,000. Sales Rs. 90,000. Margin 20% on cost. Cl...
The correct answer is c) Rs. 25,000.
Step 1: Calculate the cost price (C.P.):
Cost Price (C.P.) = Sales / (1 + Margin Percentage) = 90,000 / 1.20 = 75,000
Step 2: Calculate the closing inventory:
Closing Inventory = Goods Purchased - COGS = 1,00,000 - 75,000 = 25,000
Step 1: Calculate the cost price (C.P.):
Cost Price (C.P.) = Sales / (1 + Margin Percentage) = 90,000 / 1.20 = 75,000
Step 2: Calculate the closing inventory:
Closing Inventory = Goods Purchased - COGS = 1,00,000 - 75,000 = 25,000
Most Upvoted Answer
Goods purchased Rs. 1,00,000. Sales Rs. 90,000. Margin 20% on cost. Cl...
if cost is 100 then margin is 20 and sales is 100 + 20 = 120/-
therefore cost of sales = 90000 x 100/120 = 75000/-
closing inventory = purchases - cost of sales = 100000 - 75000 = 25000
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Community Answer
Goods purchased Rs. 1,00,000. Sales Rs. 90,000. Margin 20% on cost. Cl...
Given Information:
Cost of goods purchased = Rs. 1,00,000
Sales = Rs. 90,000
Margin on cost = 20%
To find:
Closing Inventory
Solution:
1. Calculation of Cost of Goods Sold (COGS)
COGS = Sales / (1 + Margin%)
COGS = 90,000 / (1 + 20/100)
COGS = Rs. 75,000
2. Calculation of Cost of Goods Purchased (COGP)
COGP = COGS + Closing Inventory - Opening Inventory
COGP = 75,000 + Closing Inventory - Opening Inventory
3. Calculation of Opening Inventory (OI)
OI = COGP - Goods Purchased
OI = COGP - 1,00,000
4. Substituting the values in equation (2)
COGP = 75,000 + Closing Inventory - (COGP - 1,00,000)
2*COGP = 1,75,000 + Closing Inventory
COGP = 87,500 + Closing Inventory
5. Substituting the value of COGP from equation (4) in equation (5)
87,500 + Closing Inventory = 75,000 + Closing Inventory - (COGP - 1,00,000)
12,500 = COGP - 25,000
COGP = Rs. 37,500
6. Calculation of Closing Inventory
Closing Inventory = COGP - Goods Purchased + Opening Inventory
Closing Inventory = 37,500 - 1,00,000 + (COGP - 1,00,000)
Closing Inventory = COGP - 1,62,500
Substituting the value of COGP from equation (5) in equation (6)
Closing Inventory = 87,500 + Closing Inventory - 1,62,500
Closing Inventory = Rs. 25,000
Therefore, the closing inventory is Rs. 25,000.
Cost of goods purchased = Rs. 1,00,000
Sales = Rs. 90,000
Margin on cost = 20%
To find:
Closing Inventory
Solution:
1. Calculation of Cost of Goods Sold (COGS)
COGS = Sales / (1 + Margin%)
COGS = 90,000 / (1 + 20/100)
COGS = Rs. 75,000
2. Calculation of Cost of Goods Purchased (COGP)
COGP = COGS + Closing Inventory - Opening Inventory
COGP = 75,000 + Closing Inventory - Opening Inventory
3. Calculation of Opening Inventory (OI)
OI = COGP - Goods Purchased
OI = COGP - 1,00,000
4. Substituting the values in equation (2)
COGP = 75,000 + Closing Inventory - (COGP - 1,00,000)
2*COGP = 1,75,000 + Closing Inventory
COGP = 87,500 + Closing Inventory
5. Substituting the value of COGP from equation (4) in equation (5)
87,500 + Closing Inventory = 75,000 + Closing Inventory - (COGP - 1,00,000)
12,500 = COGP - 25,000
COGP = Rs. 37,500
6. Calculation of Closing Inventory
Closing Inventory = COGP - Goods Purchased + Opening Inventory
Closing Inventory = 37,500 - 1,00,000 + (COGP - 1,00,000)
Closing Inventory = COGP - 1,62,500
Substituting the value of COGP from equation (5) in equation (6)
Closing Inventory = 87,500 + Closing Inventory - 1,62,500
Closing Inventory = Rs. 25,000
Therefore, the closing inventory is Rs. 25,000.
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Goods purchased Rs. 1,00,000. Sales Rs. 90,000. Margin 20% on cost. Closing Inventory =?a)Rs.20,000b)Rs.10,000c)Rs.25,000d)Rs.28,000Correct answer is option 'C'. Can you explain this answer?
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Goods purchased Rs. 1,00,000. Sales Rs. 90,000. Margin 20% on cost. Closing Inventory =?a)Rs.20,000b)Rs.10,000c)Rs.25,000d)Rs.28,000Correct answer is option 'C'. Can you explain this answer? for CA Foundation 2025 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Goods purchased Rs. 1,00,000. Sales Rs. 90,000. Margin 20% on cost. Closing Inventory =?a)Rs.20,000b)Rs.10,000c)Rs.25,000d)Rs.28,000Correct answer is option 'C'. Can you explain this answer? covers all topics & solutions for CA Foundation 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Goods purchased Rs. 1,00,000. Sales Rs. 90,000. Margin 20% on cost. Closing Inventory =?a)Rs.20,000b)Rs.10,000c)Rs.25,000d)Rs.28,000Correct answer is option 'C'. Can you explain this answer?.
Goods purchased Rs. 1,00,000. Sales Rs. 90,000. Margin 20% on cost. Closing Inventory =?a)Rs.20,000b)Rs.10,000c)Rs.25,000d)Rs.28,000Correct answer is option 'C'. Can you explain this answer? for CA Foundation 2025 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Goods purchased Rs. 1,00,000. Sales Rs. 90,000. Margin 20% on cost. Closing Inventory =?a)Rs.20,000b)Rs.10,000c)Rs.25,000d)Rs.28,000Correct answer is option 'C'. Can you explain this answer? covers all topics & solutions for CA Foundation 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Goods purchased Rs. 1,00,000. Sales Rs. 90,000. Margin 20% on cost. Closing Inventory =?a)Rs.20,000b)Rs.10,000c)Rs.25,000d)Rs.28,000Correct answer is option 'C'. Can you explain this answer?.
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