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

Preparation of financial statements — practice question

Inventory with a cost of $1200 has been damaged. Under normal circumstances, it would be sold for $1800. If repairs are carried out at a cost of $600, it can be sold for $1700. The cost of replacing the inventory would be $1000. At which amount should the damaged inventory be recorded in the financial statements?

  • A$1000
  • B$1100
  • C$1200
  • D$1800

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