Accounting 9706 · AS & A Level · Traditional costing methods

Traditional costing methods — practice question

The financial year of a company finishes on 30 November, and there is no opening inventory at the start of the financial year. In the year, inventory is bought in the following amounts: - 30 March: 330 units at a unit cost of $40$ - 1 November: 288 units at a unit cost of $50$ Sales in the period total 500 units sold at $100$ per unit. The inventory is measured by the average cost (AVCO) method. Calculate the value of inventory, to the nearest dollar, at the end of the year.

  • A$4720
  • B$5270
  • C$5900
  • D$11800

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