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

Preparation of financial statements — practice question

A company sells goods with a mark-up of $25\%$. The information below was available at the end of the financial year. Goods in warehouse: $\$300\,000$ (cost) Goods sent on sale or return: $\$200\,000$ (at invoice price) What value should closing inventory have in the financial statements?

  • A$\$300\,000$
  • B$\$450\,000$
  • C$\$460\,000$
  • D$\$500\,000$

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