Calculate the cost of goods sold:
Sales Rs. 4,20,000
Rate of gross profit on cost 20%
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Calculate the cost of goods sold:
Sales Rs. 4,20,000
Rate of gross profit on cost 20%
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Explanation:
Given :
To find :
Solution :
Sales Rs. 4,20,000
Rate of Gross profit on Cost 20%
Let,
Cost of Goods Sold = x
Rate of Gross profit on Cost 20%
Sales = Cost of Goods Sold + Gross profit
4,20,000 = x + 20x/100
4,20,000 = x + 0.2x
4,20,000 = 1.2x
x = 4,20,000/1.2
x = 3,50,000
Cost of Goods Sold = Rs. 3,50,000
★ Gross Profit =
3,50,000 × (20/100) = Rs. 70,000
Sales = Cost of Goods Sold + Gross profit
420,000 = 3,50,000 + 70,000
Therefore, Cost of Goods Sold = Rs. 3,50,000