Accounting 9706 · AS & A Level · Preparation of financial statements

Preparation of financial statements — practice question

On 1 January, at the beginning of the year, the business held stationery inventory costing $3740. At that date, suppliers were still due $1200 for stationery. Throughout the financial year ending 31 December, $38800 in total was paid for stationery. A quantity of old stationery was sold to staff for $240. By 31 December, at the year end, the business’s stationery inventory, measured at cost, was $4200. On that date, the amount still payable to suppliers for stationery was $1800. Which amount should be entered in the statement of profit or loss for the year ended 31 December for stationery?

  • A$34960
  • B$36160
  • C$38700
  • D$38940

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