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

Preparation of financial statements — practice question

Hedley keeps $100$ items of inventory in his warehouse, and a further five are held by a customer on a sale or return basis. He gives the following details. Historic cost paid per unit: $60$ Selling price per unit: $85$ Current replacement cost per unit: $65$ Which figure should be shown for inventory in the statement of financial position?

  • A$6\,000$
  • B$6\,300$
  • C$6\,825$
  • D$8\,500$

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