Question

Company is involved in computer manufacturing business. During the year, company purchased computer materials and accessories worth £950,000, out of which materials worth £40,000 were for replacement costs of computers used in office and materials worth £75,000 were for new purchases of computers used by staff working from home. Which of the following will be correct?
a. Cost of sales £875,000 and Capital cost £75,000
b. Capital cost £950,000 to be depreciated
c. Cost of sales £835,000, Operating costs £40,000, Capital cost £75,000
d. Revenue cost £835,000, Capital cost £115,000

Answer 1

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