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Ratio analysis

Financial Management

Sir in ratio formulas we use into 100 (*100) for some formulas and for some we don't use into hundred. Example gp ratio we use gp/sales*100 but for stock turnover we use cogs /average stock . Here we didn't use into 100. Please explain when to use into 100 and when not to use iam confused

Enuguru Sai Nithin

CA Final

★ 78K+

21-Feb-21 09:12

290

Answers (1)

Best Answer

This is with respect to the intention of each formulae GP ratio is meant for knowing gross profit per 100rupee sales. Stock Turnover meant for knowing the stock is how many times of sales.or how many time we can convert those stock into sales