Explanation

To find the opening stock, use the following formula:

Opening Stock = Cost of Goods Sold - (Purchases + Freight Inward - Closing Stock)

Given:

• Cost of Goods Sold = Rs. 245,000
• Purchases = Rs. 250,000
• Freight Inward = Rs. 5,000
• Closing Stock = Rs. 25,000

Opening Stock = Rs. 245,000 - (Rs. 250,000 + Rs. 5,000 - Rs. 25,000)

Opening Stock = Rs. 245,000 - Rs. 230,000 = Rs. 15,000

So, the amount of opening stock is Rs. 15,000.

Explanation

To calculate the annual depreciation rate, you can use the following formula:

Annual Depreciation = (Cost - Scrap Value) / Estimated Life

= ($20,000 - $10,000) / 5

= $10,000 / 5

= $2,000 per year

To find the percentage rate of depreciation, divide the annual depreciation by the cost and multiply by 100:

Percentage Rate = (Annual Depreciation / Cost) x 100

= ($2,000 / $20,000) x 100

= 10%

So, the percentage rate of depreciation on an annual basis is 10%.

Explanation

Contribution margin is revenue remaining after deducting variable costs and may be expressed as unit contribution margin.

It measures how much revenue is available to cover fixed costs and generate profit after variable costs have been covered.

Explanation

To find the trader's drawings, use the following formula:

Drawings = Opening Capital + Net Profit - Closing Capital

Given:

• Opening Capital = $12,000
• Closing Capital = $13,800
• Net Profit = $3,000

Drawings = $12,000 + $3,000 - $13,800 = $1,200

So, the trader's drawings are $1,200.

Explanation

Liquid or quick assets are equal to current assets - (stock + work in progress).

This calculation excludes inventories and work in progress from current assets to focus on the most liquid assets available for immediate use.

Explanation

A project should be accepted if its internal rate of return (IRR) exceeds the company's required rate of return.

This indicates that the project is expected to generate returns higher than the company's minimum acceptable return, making it a potentially profitable investment.

Explanation

The current ratio is equal to current assets / current liabilities.

It measures a company's ability to cover its short-term liabilities with its short-term assets.

Explanation

 Cash flow statement shows the flow of cash and cash equivalents during the financial period 

Explanation

A method used in a comparative analysis of financial statement is Common size analysis

Explanation

An un adjusted balance in cash book is because of the result of which error  The omission of Bank charges