Practicing Success
A company maintains average inventory of ₹1,20,000. Its inventory turnover ratio is 6 times. If company sells goods at a gross profit of 25% on revenue from operations. Find out revenue from operations: |
₹7,20,000 ₹9,60,000 ₹2,40,000 ₹8,40,000 |
₹9,60,000 |
The correct answer is Option (2) - ₹9,60,000. Inventory turnover ratio = Cost of revenue from operations / Average inventory Let revenue from operations = a Revenue from operations = Cost of revenue from operations + Gross profit |