Hey I didn't get how they calculated invoice price for opening stock. Can someone explain and help ?

Hitesh · 28 Aug 2024

Question have mentioned that profit is 25% at selling price in first sentence it means 1/4 on selling price then 1/3 on cost it's simple logic

Vedantika · 28 Aug 2024

Ok got it 👍🏻 thank you!

Ashvath · 28 Aug 2024

It is mentioned that gross profit ratio is 25% Opening stock in the question is at cost Gross profit= 25% on invoice price Since in the question is not specifically mentioned,we have to take assumption that 25% is on invoice price Since 25% on invoice price is equals to 1/3 on cost Opening stock is valued at cost plus 1/3 %