Riaz holds an average inventory of 36,000(CP) with an inventory turnover of 5 times. If the firm makes a gross profit of 25% on sales, find the total sales of the company.

Related Mcqs:

1. Budgeted sales for the next year is 5,00,000 units. Desired ending finished goods inventory is 1,50,000 units and equivalent units in ending W-I-P inventory is 60,000 units. The opening finished goods inventory for the next year is 80,000 units, with 50,000 equivalent units in beginning W-I-P inventory How many equivalent units should be produced?

   A. 5,80,000
   B. 5,50,000
   C. 5,00,000
   D. 5,75,000

2. Find the value of opening stock from the following data. Purchases 1,50,000, Closing stock 30,000 Sales 2,20,000, Gross profit 40,000.

   A. 50,000
   B. 55,000
   C. 60,000
   D. 65,000

3. A company is currently operating at 80% capacity level. The production under normal capacity level is 1,50,000 units. The variable cost per unit is ` 14 and the total fixed costs are ` 8,00,000. If the company wants to earn a profit of ` 4,00,000, then the price of the product per unit should be

   A. 37.50
   B. 38.25
   C. 24.00
   D. 35.00

4. The beginnings inventory of the current year is overstated by 5,000 and closing inventory is overstated by 12,000. These errors will cause the net income for the current year by

   A. 17,000 (overstated.
   B. 12,000 (understated.
   C. 7,000 (overstated.
   D. 7,000 (understated.

5. Calculate the amount of cash if: Total assets=$10,000 Total liabilities=$10,000 Total Capital=$5000

   A. $6000
   B. $10,000
   C. $5000
   D. $1000

6. If the asset turnover and profit margin of a company are 1.85 and 0.35 respectively, the return on investment is.

   A. 0.65
   B. 0.35
   C. 1.50
   D. 5.29

7. For the past 3 years, DK Ltd. has failed to accrue unpaid wages earned by workers during the last week of the year. The amounts omitted, which were considered material, were as follows:
   March 31,2010 – ` 56,000
   March 31, 2011 – ` 51,000
   March 31, 2012 – ` 64,000
   The entry on March 31, 2012 to rectify these omissions would include a

   A. Credit to wage expense for ` 64,000
   B. Debit to wage expense for ` 64,000
   C. Debit to wage expense for ` 51,000
   D. Debit to wage expense for ` 13,000

8. A second hand car is purchased for 2,00,000 and sold at 1,40,000 after two years. If depreciation is charged @ 10% on SLM method, find the profit or loss on sale of the car?

   A. 20,000 Loss
   B. 20,000 Profit
   C. 10,000 Loss
   D. 10,000 Profit

9. A second hand car is purchased for 2,00,000 and sold at 1,40,000 after two years. If depreciation is charged @ 10% on written down value method, find the profit or loss on sale of the Second hand car?

   A. Loss of 20,000
   B. Loss of 22,000
   C. Loss of 11,000
   D. Profit of 11,000

10. Recent developments have made much of a company‘s inventory obsolete. This obsolete inventory should be?

    A. Written down to zero or its scrap value
    B. Shown in the Balance Sheet at its replacement cost
    C. Shown in the Balance Sheet at cost, but classified as a non-current asset
    D. Carried in the accounting records at cost until it is sold