The following information is given about a Non profit organisation for the year ended 31st March,2019.
Creditors for stationery on 1st April,2018 =₹4600
Creditors for stationery on 31st march,2019 =₹11800
Opening stock of stationery = ₹15000
Closing stock of stationery = ₹30400
During the year ₹56800 is paid to creditors.
Stationery purchased in cash during the year was 20% of the total purchase of stationery.

What will be the amount of cash purchases of stationery?

₹16000

The correct answer is option 2- ₹16000.

Let the total purchases is x
Cash purchases is 20% of x means x/5
Credit purchases is 80% of x means 4x/5
x/5 + 64000 = x
4x/5 = 64000
x = 64000 X 5/4 = ₹80000
Payment made to creditors = 56800
Add: closing creditors = 11800
Less: Opening creditors = 4600
Stationery purchased on credit = 56800+11800-4600= 64000

Cash purchases = Total purchases - credit purchases
                          = 80000 - 64000
                          = ₹16000