| Particulars | Amount (Rs.) | Particulars | Amount (Rs.) |
| Credit Sales | 5,00,000 | Decrease in Inventory | 10,000 |
| Purchases | 3,00,000 | Returns Outward | 10,000 |
| Carriage Inwards | 10,000 | Wages | 50,000 |
Rate of Credit Sale to Cash Sale 4: 1
SOLUTION
Credit Sale = Rs. 5,00,000
Rate of Credit Sale to Cash Sale = 4: 1
Cash Sale = 14 × 5,00,000
= Rs. 1,25,000
Total Sales = Cash Sales + Credit Sales
= 1,25,000 + 5,00,000
= Rs. 6,25,000
Cost of Goods Sold = Purchases – Return Outward + Carriage Inwards + Wages + Decrease in Inventory
= 3,00,000 – 10,000 + 10,000 + 50,000 + 10,000
= Rs. 3,60,000
Gross Profit = Total Sales – Cost of Goods Sold
= 6,25,000 – 3,60,000
= Rs. 2,65,000
Gross Profit Ratio = Gross Profit / Net Sales × 100
= 2,65,000 / 6,25,000 × 100
= 42.40%