Question : Which of the following statements is false?
Option 1: Cost of Revenue = Opening Inventory + Purchases + Carriage from Operations + Wages + Other Direct Charges - Closing Inventory
Option 2: Cost of Revenue from Operations = Revenue from Operations (Cost of Goods Sold) - Gross Profit.
Option 3: Revenue from Operations + Gross Loss= cost of revenue from operation
Option 4: None of the above
Correct Answer: Revenue from Operations + Gross Loss= cost of revenue from operation
Solution : Answer = Revenue from Operations + Gross Loss= cost of revenue from operation
In accounting, revenue is not added to gross loss to calculate the cost of revenue from operations. Instead, the correct formula is Cost of Revenue from Operations = Revenue from Operations (Cost of Goods Sold) - Gross Profit. Hence, the correct option is 3.
Question : Cost of Revenue from Operations -
Question : What formula is used to compute the inventory turnover ratio?
Question : From the following details, Closing Inventory Rs. 60,000; Total Revenue from Operations Rs.5,00,000 (including cash revenue from operations Rs. 1,00,000 ); Total purchases Rs.3,00,000 (including credit purchases Rs.60,000). Goods are sold at a profit of 25% on cost.
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