Sai Baba made sales of ₦10,000 having computed his gross profit % to sales to be 20. His opening stock was ₦250 and ending stock is ₦200. Calculate his purc...
Sai Baba made sales of ₦10,000 having computed his gross profit % to sales to be 20. His opening stock was ₦250 and ending stock is ₦200. Calculate his purchases.
Answer Details
The gross profit percentage of sales would be
20% x ₦10,000 = ₦2000
If cost of sales + gross profit = ₦10,000 = ₦2000
:. ₦8000 + ₦2000 = ₦10,000
If cost of goods available for sales less closing stock
= cost of sales
:. ₦8200 + ₦200 = ₦8000
Hence; cost of goods available for sale = opening stock + purchases