Question

During a year the sales and purchases of a firm amounted to Rs 4,00,000 and Rs 4,00,000 respectively. Opening inventory was Nil. Closing inventory at selling price was Rs 1,00,000. Find out the cost of closing inventory using Adjusted Selling Price Mehtod: (a) Rs 80,000 (b) Rs 1,00,000 (c) Rs 1,50,000 (d) Rs 1,40,000

Answer 1

Goods of Rs. 800 (sales price) sent on sale on approval basis were included in the sales book. The profit included in the sales was 25% on cost. Inventory with the party will increase our closing inventory by (a) Rs. 600 (b) Rs. 640 (c) Rs. 680 (d) Rs. 700