BXY Enterprise has the following balance at the end of march 2010
opening stock
D6,000
purchases
D23,000
salaries and wages
D12,000
closing stock
D8,000
sales
D30,000
Use the information above to answer the following question.
what is the rate of turnover by BYX Enterprise
A. 5.0 times B. 3.5 times C. 3.0 times D. 1.5 times
Correct Answer: C
Explanation
Rate of Turnover = opening stock + cost of goods sold / closing stock (first, we determine the value for cost of goods sold since it isnt given in the table) (cost of goods sold is gotten as = opening stock + purchases - closing stock) (COGS= 6000 + 23000 - 8000 = 21000) ''since we now know the value of cost of sales, we can now calculate the rate of turnover'' rate of turnover = 6,000 + 21,000 / 8,000 27,000 / 8,000 = 3.0 times
