What will be the treatment of Loose Tools/Spares and Stores while calculating the following :-

1. Current Ratio
2.Inventory Turnover Ratio
3.Working Capital
4.Working Capital Turnover
5.Cost of Goods Sold

Thank you in advance.

Question

What will be the treatment of Loose Tools/Spares and Stores while
calculating the following :-

1 Current Ratio
2 Inventory Turnover Ratio
3 Working Capital
4 Working Capital Turnover
5 Cost of Goods Sold

Thank you in advance

Anushka · Answer

Loose tools and stores and spares are part of CURRENT ASSETS
(Inventory)
1 Current ratio = current assets ÷ current liabities
2 Inventory turnover ratio = COGS ÷ average inventory
3 Working capital = Current assets ÷ current liabilities
4 working capital turnover ratio = net sales ÷ working
capital
5 COGS = net sales - gross profit

What will be the treatment of Loose Tools/Spares and Stores while calculating the following :- 1. Current Ratio 2.Inventory Turnover Ratio 3.Working Capital 4.Working Capital Turnover 5.Cost of Goods Sold Thank you in advance.

What will be the treatment of Loose Tools/Spares and Stores while calculating the following :-

1. Current Ratio
2.Inventory Turnover Ratio
3.Working Capital
4.Working Capital Turnover
5.Cost of Goods Sold

Thank you in advance.