I. A retailer when fixing his selling price adds one-quarter to the cost of the article
II. The expenses of the retailer is 10% of his sales
III. The total sales is N23,000
IV. he turned over his stock five times in the year.
Compute the average amount of stock in hand at cost price

Omo_jolaade

1 year ago

Let's break it down step by step:

Step 1: Calculate the total cost of goods sold
Given that the retailer adds one-quarter (25%) to the cost price, let's denote the cost price as x. The selling price would be 1.25x.

Step 2: Calculate the total cost of goods sold
Total sales = N23,000. Since the selling price is 1.25x, we can set up the equation:
Total Sales = 1.25x * Number of units sold
Let's denote the total cost of goods sold as C. Then:
N23,000 = 1.25C
C = N23,000 / 1.25
C = N18,400

Step 3: Calculate the average stock
Given that the retailer turned over his stock five times in the year, we can use the formula:
Stock Turnover = Cost of Goods Sold / Average Stock
Rearranging the formula to solve for Average Stock:
Average Stock = Cost of Goods Sold / Stock Turnover
Average Stock = N18,400 / 5
Average Stock = N3,680

The final answer is: N3680

Dboy1111

5 years ago

Pls explain