From the following information, calculate inventory Turnover Ratio :
| PARTICULARS | AMOUNT (₹) |
| Inventory in the beginning | 18,000 |
| Inventory at the end | 22,000 |
| Net purchases | 46,000 |
| Wages | 14,000 |
| Revenue from operations | 80,000 |
| Carriage inwards | 4,000 |
Answer & explanation
Correct answer: option 3
The correct answer is Option (3) → 3 times
Cost of revenue from operations = opening inventory + net purchases + wages + carriage inwards − closing inventory
= ₹18,000 + ₹46,000 + ₹14,000 + ₹4,000 − ₹22,000 = ₹60,000
Average inventory = (₹18,000 + ₹22,000) ÷ 2 = ₹20,000
Inventory turnover ratio = ₹60,000 ÷ ₹20,000 = 3 times
NCERT (2026-27 edition):
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