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WAEC Commerce 2018 Question 16

Question 16

Business Calculations

If the opening stock of Ali Ltd is N40,000, cost of goods sold is N48,000 and closing stock is N24,000, its rate of turnover will be

  1. A.1.2 times.
  2. B.1.5 times.
  3. C.2.0 times.
  4. D.7.5 times.
Show the answer and explanation

Answer: B (1.5 times.)

Explanation

Average stock = (40,000 + 24,000) ÷ 2 = N32,000. Rate of turnover = cost of goods sold ÷ average stock = 48,000 ÷ 32,000 = 1.5 times.