From the following information, calculate the historical cost of closing inventories using adjusted selling price method: Purchase during the year…

Sales - 11,25,000 Add: Closing inventory (at selling price) ₹ 1,50,000 Selling price of goods available for sale:12,75,000 Less: Cost of goods available for sale ₹ (₹ 7,50,000) Gross margin - 5,25,000 Rate of gross margin = (₹ 5,25,000 /12,75,000) ×₹ 100 = 41.18% Cost of closing inventory = 1,50,000 less41.18% of 1,50,000 = 88,230 *This rate may also be considered as 41.176% in that case, the closing inventory will be valued at 88,236 OR as 41.17% in that case, the closing inventory will be valued at 88,245