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WAEC Commerce 2002 Question 11

Question 11

Business Calculations

Use the following information: Ndu Enterprises has the following state of affairs: Stock 1st Jan. was N3,500 and 31st December was N3,000. His purchases was N30,000 and sales was N38,000 while a total of rent and electricity bills of N4,500 was paid.
The rate of stock turnover is

  1. A.1.2 times
  2. B.1.3 times
  3. C.4.6 times
  4. D.9.4 times
Show the answer and explanation

Answer: D (9.4 times)

Explanation

Average stock = (3,500 + 3,000) ÷ 2 = 3,250; rate = 30,500 ÷ 3,250 ≈ 9.4 times.