Accounting 9706 · AS & A Level · Preparation of financial statements
Preparation of financial statements — practice question
Y Limited despatched goods on consignment to Mahood on agreed terms, which included an advance payment and a commission of $5\%$ on sales after commission deductions.
(a)[2]
Work out the cost per unit that should be applied when valuing inventory.
(b)[13]
Draw up the consignment account in the books of Y Limited for the year ended 31 December 2017.
(c)[5]
Draw up Mahood’s account in the books of Y Limited for the year ended 31 December 2017.
(d)[5]
Suggest whether Y Limited should keep consigning goods to Mahood or set up a branch overseas. Justify your answer.
Worked solution & mark scheme
This 25-mark question has a full step-by-step worked solution and mark scheme. One marking point: “Overall cost $198 000” …