Inventories-Test 1

Periodic inventory system has all the following limitations except

Kanika traders close their books of accounts on 31st March every year. As stores manager was on leave inventory taking was done on 7th April, 2014. On this date, cost of goods in godown was Rs.44,500. During 1st April, 2014 to 7th April, 2014 sales were Rs.1,76,000, Purchases Rs.1,12,000. Purchases return Rs.8,630. Sales return Rs.4,200. Gross profit earned during the year was 25% on cost. Calculate the value of inventory as on 31st March, 2014.

_____ method is a non historical cost method of inventory valuation also known as retail inventory method.

Following are the features of perpetual inventory system except :

M/s X, Y and Z are in retail business, following information are obtained from their records for the year ended 31st March, 2014.

Goods received form suppliers                                    Rs.18,00,000

(Subject to trade discount and taxes)

Trade discount 3% and sales tax @11%

Packaging and transportation charges                        Rs.     80,000

Sales during the year                                                        Rs.25,00,000

Sales price of closing stock                                               Rs.4,00,000

Find out the historical cost of inventories using adjusted selling price method

Indian oil is a bulk distributor of petrol, a periodic inventory of petrol on hand is taken when the books are closed at the end of each month. The following summary of information is available for the month :

Sales                                                               Rs.37,80,000

General administration cost                      Rs.  1,00,000

Opening inventory : 100000 litres

@ Rs.12 per litre                                            Rs.12,00,000

Purchases (including freight inward) :

June 1   2,00,000 litres @ Rs.11.40 per litre

June 30  1,00,000 liters @ Rs.12.12 per liter

June 30   Closing inventory 1,30,000 liters

Using the information given above, compute the amount of cost of goods sold for the month of June using LIFO principle :

M/s Moon Ltd. given the following information at the end of the year :

Opening stock                                     Rs.  50,000

Purchases                                             Rs.1,40,000

Sales (at cost plus 33 1/3% )             Rs.1,80,000

Goods cost worth Rs.25,000 destroyed due to fire during the year and a claim of Rs.15,000 accepted by insurance. The value of the closing inventory at the end of the year will be :

From the following information of a retail business, find out the cost of inventories, applying adjusted selling price method.

Goods received from supplier         Rs.7,00,000

Opening stock and expenses                         Nil

Sales during the year                         Rs.8,00,000

Sales price of closing inventories    Rs.2,00,000

From the following one is not a basic feature of the “PERPETUAL” inventory system :

The Axe Company, a whole seller estimates the following for the indicated months.

September 2015      October 2015

Opening inventory          5,36,000               6,42,500

Credit Sales                       8,40,000               9,60,000

Cash Sales                         12,24,000              12,44,000

Selling price is 20% more than the purchase price.

Value of inventories purchased in September, 2015 is :

Veeru makes up his annual accounts to 31st December each year. He was unable to take stock of physical inventory till January 9, 2016 on which date the physical stock at cost was valued at Rs.70,000.

You are required to ascertain the value of physical stock at cost on 31st December, 2015 from the following information regarding period from 1st January, 2016 to 9 January, 2016.

Sale of goods amounted to Rs.48,000 of which goods of a sale value of Rs.5,000 had not been delivered at the time of verification and goods of a sale value of Rs.3,000 had been delivered on 29.12.2015.

The rate of gross profit was 25% on the cost price.

The amount of purchase will be if

opening inventory                      Rs.   23,200

Cost of goods sold is                   Rs.3,22,800

Closing inventory                        Rs.  24,000

From the following data, find out the gross profit under the weighted average method of inventory valuation :

1st January Inventory 1000 units @ Rs.4 each

31st January Purchases 1100 units @ Rs.5 each

25th February Purchases 1300 units @ Rs.6 each

Sales for the period, 3000 units @ Rs.10 each

Sales for the year ended 31st March, 2016 amounted to Rs.10,00,000. Sales included goods sold to Mr.A for Rs.50,000 at a gross profit of 20% on cost. Such goods are still lying in the godown at buyer risk. Therefore, such goods should be treated as part of :

Consider the following information pertaining to G & Sons as on March 31st, 2016.

Particulars                                                  Rs.

Opening inventory                                     7,50,000

Purchases during the year 2015-16       22,50,000

Sales during the year 2015-16                 25,00,000

As per physical inventory taken on March 31, 2016 the closing inventory was Rs.10,45,000. Gross profit on sales has remained constant at 25%. The management of the firm suspects that some inventory might have been taken away by a new employee. The estimated cost of missing inventory on the close of the financial year and the cost of goods sold during the year respectively are :

G.Ltd., a dealer in second hand bikes has the following five vehicles of different models and makes in their inventory at the end of the financial year 2015-16.

Bike           Passion            Bajaj             Rajdoot              Splendor           Royal Enfield

Cost(Rs.)    45,000          57,500           1,37,500              50,000                 1,05,000

NRV(Rs.)    47,600          77,500           1,32,500              62,500                  1,00,000

The value of inventory included in the Balance  Sheet of the company as on March 31, 2016 was :

Which method is exception to non historical cost method ?

Average stock is Rs.28,000, closing stock is Rs.6,000 more than the opening stock, the closing stock is ____ .

Cost of physical inventory on 15.4.16 was Rs.3,00,000 Sales amounting to Rs.1,00,000 and purchases worth Rs.50,000 were made between 31.316 and 15.4.16. Goods are sold at 20% profit on sales. Value of inventory as on 31.3.16 is :

From the following data M/s Jeep Ltd. find out the profit under the weighted average method of inventory valuation 1st January Inventory 1000 units @ 4 each 2nd January Purchases 1200 units @ 5 each sale for the period is 2000 units @ 8 per unit.

The cost of inventory on 20 April 2016 was computed at Rs.5,25,000. The purchase of goods from April 1, 2016 to 20th April, 2016 were Rs.3,25,000, which include cash purchase of Rs.75,000 and goods costing Rs.50,000 not yet received. The value of closing stock for year ended March 31, 2016 would be :

While finalizing the current year’s profit, Roshni observed that in the previous year, closing inventory was valued more by Rs.45,000. As a result :

Sales of a company included goods sold to M/s ABC for Rs.60,000 at a profit of 25% on cost. Such goods are still lying in the godown of the company at buyer’s risk. Such good should be treated as part of _______ .

If average inventory is Rs.30,000 and closing inventory is Rs.5,000 more than the opening inventory. The value of closing inventory will be :

Opening stock Rs.1,00,000, Closing stock Rs.2,75,000, Purchases Rs.4,00,000, Selling price = 25% on sales. The sales are –

Consider the following data pertaining to CAS Ltd. for the month of March 2007 :

As at March 01, 2007           As at March 31, 2007

Stock                            Rs.3,60,000                                 Rs.1,80,000

The company made purchases amounting Rs.6,60,000 on credit. During the month of March 2007, the company paid a sum of Rs.7,00,000 to the suppliers. The goods are sold at 25% above the cost. The sales for the month of March 2007 were :

Consider the following data pertaining to a CAS Ltd. for the month of March 2007 :

Opening stock                   Rs.44,000

Closing stock                      Rs.50,000

Purchases less returns      Rs.2,20,000

Gross profit margin                      20%

The sales of the company during the month are

Consider the following data pertaining to CAS Ltd. for the month of March 2007 :

Opening stock                        Rs.  60,000

Closing stock                           Rs.  80,000

Purchases                                 Rs.11,20,000

Returns outward                     Rs.   30,000

Return inward                         Rs.  40,000

Carriage inward                       Rs.   10,000

If the gross profit is 20% of net sales, the gross sales for the month of March 2007 is

Sales Rs.30,000, Selling price = 33 1/3% on cost, Cost of goods available for sale Rs.5,00,000, Closing Inventory is

X Ltd. purchased 100 units @ Rs.10 for cash, 200 units @ Rs.20 subject to 10% trade discount and 5% cash discount against current dated cheque. The total amount of purchases is –