Accounting 9706 · AS & A Level · Traditional costing methods

Traditional costing methods — practice question

A business values its inventory by using the AVCO method. On 1 June 2017, the inventory consisted of 100 units, each worth $2.40. The following events occurred. June 5: 40 units were purchased at $2.50 per unit June 7: 60 units were sold at $3.50 per unit What was the value of the inventory on 8 June 2017, correct to the nearest dollar?

  • A$194
  • B$196
  • C$200
  • D$224

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