What will be the closing inventory of the company, if the following information is available?
| PARTICULARS | AMOUNT (₹) |
| Cost of goods sold | 5,40,000 |
| Purchases | 5,50,000 |
| Direct expenses | 30,000 |
| Opening inventory | 70,000 |
Answer & explanation
Correct answer: option 4
The correct answer is option 4- ₹1,10,000.
Cost of goods sold = opening inventory + purchase + direct expenses - closing inventory
5,40,000 = 70,000 + 5,50,000 + 30,000 - closing inventory
Closing inventory = 6,50,000 - 5,40,000
= ₹1,10,000