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Question : When opening stock is Rs.50,000 closing stock Rs.60,000 and cost of goods sold is Rs.2,20,000, then stock turn over ratio is?

Option 1: 3 times

Option 2: 4 times

Option 3: 2 times

Option 4: 5 times


Team Careers360 24th Jan, 2024
Answer (1)
Team Careers360 25th Jan, 2024

Correct Answer: 4 times


Solution : Cost of good sold = 2,20,000

Average Inventory = (Opening inventory + Closing inventory) / 2

= (50000+60000) / 2 = 55,000

Inventory turnover ratio= Cost of good sold/ Average inventory
=2,20,000/55,000
=4 Times

Hence the correct answer is option 2.

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