Case Study Information:Pragya Madan, an ex-Indian hockey player, decided to start a hockey academy named "Bright Hockey Academy" on 1st April 2022 to train young girls.Her neighbor, Ishwar, died and willed his land to start the academy.Her father, Ramkumar, spent ₹20,00,000 for the construction of a pavilion.100 young girls joined the academy and paid an annual subscription of ₹1,000 each.10 members paid a single amount of ₹25,000 each to obtain life membership.Hockey sticks and balls purchased during the year amounted to ₹27,000. Closing stock of these items is nil.Question: Sports material consumed during the financial year 2022-2023 will be:
- A₹27,000
- B₹17,000
- C₹20,000
- D₹47,000
Solution & Step-by-step Explanation
The formula for material consumption is:
Since it is a newly started academy, Opening Stock = 0. Purchases = ₹27,000. Closing Stock = 0.
Since it is a newly started academy, Opening Stock = 0. Purchases = ₹27,000. Closing Stock = 0.