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From the following data, compute Gross Profit of the Branch :
Goods received from the H.O. at invoice price
Rs. 60,000
Returns to H.O. at invoice price
Rs. 1,200
Branch stock on 1-4-97 at invoice price
Rs. 6,000
Branch stock at invoice price on 31-3-98
Rs. 12,000
Surplus Stock (found in Branch stock A/c)
Rs. 2,400
Goods are invoiced to branch at cost plus 25%
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From the following data, compute Gross Profit of the Branch :Goods rec...
Calculation of Gross Profit for the Branch
To compute the Gross Profit for the branch, we will follow these steps:
1. Determine the Cost of Goods Sold (COGS)
- Goods received from H.O. (invoice price): Rs. 60,000
- Less: Returns to H.O. (invoice price): Rs. 1,200
Net Goods Received = Rs. 60,000 - Rs. 1,200 = Rs. 58,800
- Add: Opening Stock (Branch stock on 1-4-97): Rs. 6,000
- Less: Closing Stock (Branch stock on 31-3-98): Rs. 12,000
- Less: Surplus Stock found: Rs. 2,400
Total COGS Calculation:
COGS = Net Goods Received + Opening Stock - Closing Stock - Surplus Stock
COGS = Rs. 58,800 + Rs. 6,000 - Rs. 12,000 - Rs. 2,400
COGS = Rs. 50,400
2. Calculate the Sales Revenue
- To find the sales revenue, we need to adjust the COGS for the markup. Since goods are invoiced to the branch at cost plus 25%, we calculate:
Selling Price (SP) = Cost + 25% of Cost
Cost = COGS = Rs. 50,400
SP = Rs. 50,400 + (25% of Rs. 50,400)
SP = Rs. 50,400 + Rs. 12,600 = Rs. 63,000
3. Compute the Gross Profit
- Gross Profit (GP) = Sales Revenue - COGS
GP = Rs. 63,000 - Rs. 50,400
GP = Rs. 12,600
Conclusion
The Gross Profit of the branch for the period is Rs. 12,600.
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From the following data, compute Gross Profit of the Branch :Goods received from the H.O. at invoice priceRs. 60,000Returns to H.O. at invoice priceRs. 1,200Branch stock on 1-4-97 at invoice priceRs. 6,000Branch stock at invoice price on 31-3-98Rs. 12,000Surplus Stock (found in Branch stock A/c)Rs. 2,400Goods are invoiced to branch at cost plus 25%[?
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From the following data, compute Gross Profit of the Branch :Goods received from the H.O. at invoice priceRs. 60,000Returns to H.O. at invoice priceRs. 1,200Branch stock on 1-4-97 at invoice priceRs. 6,000Branch stock at invoice price on 31-3-98Rs. 12,000Surplus Stock (found in Branch stock A/c)Rs. 2,400Goods are invoiced to branch at cost plus 25%[? for B Com 2024 is part of B Com preparation. The Question and answers have been prepared according to the B Com exam syllabus. Information about From the following data, compute Gross Profit of the Branch :Goods received from the H.O. at invoice priceRs. 60,000Returns to H.O. at invoice priceRs. 1,200Branch stock on 1-4-97 at invoice priceRs. 6,000Branch stock at invoice price on 31-3-98Rs. 12,000Surplus Stock (found in Branch stock A/c)Rs. 2,400Goods are invoiced to branch at cost plus 25%[? covers all topics & solutions for B Com 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for From the following data, compute Gross Profit of the Branch :Goods received from the H.O. at invoice priceRs. 60,000Returns to H.O. at invoice priceRs. 1,200Branch stock on 1-4-97 at invoice priceRs. 6,000Branch stock at invoice price on 31-3-98Rs. 12,000Surplus Stock (found in Branch stock A/c)Rs. 2,400Goods are invoiced to branch at cost plus 25%[?.
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