Opening stock Rs. 25000, Purchases Rs. 125000, Sales Rs. 150000, Goods salvaged Rrs. 10000 and Gross Profit is 50% on cost, then the cost of the goods burnt by fire is -

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Quizplus · Accepted Answer

The cost of goods sold (COGS) can be calculated as follows: Opening stock + Purchases - Closing stock. Given that Gross Profit is 50% on cost, we can infer that the Sales are 150% of the COGS. Therefore, COGS = Sales / 1.5 = Rs. 150,000 / 1.5 = Rs. 100,000. The value of goods available for sale is Opening stock + Purchases = Rs. 25,000 + Rs. 125,000 = Rs. 150,000. The goods salvaged are Rs. 10,000. Therefore, the cost of goods burnt by fire = Goods available for sale - COGS - Goods salvaged = Rs. 150,000 - Rs. 100,000 - Rs. 10,000 = Rs. 40,000.

Opening Stock Rs