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AP2 Practice Assessment 3 Question Help

broom123broom123 New MemberRegistered Posts: 11
I'm working through the practice assessments for AP2 in preparation for my exam tomorrow and I'm struggling with question 1.2 (c)

The question gives the value of purchases and asks for the value of the destroyed inventory after a business fire.

Any help would be greatly appreciated I'm stressing out!

Comments

  • Dahir AhmedDahir Ahmed Feels At Home Registered Posts: 63
    Hi
    The question's a continuation of the scenario i.e. carries on from (b) and is concerned with the state of inventory at the end of the finacial year i.e. closing inventory.

    Therefore, what you need is to find out the closing inventory and you'll have the figure of destroyed inventory.

    Try that and see what you come up with.
  • broom123broom123 New Member Registered Posts: 11
    Hi, yes I thought that but I'm still not getting the correct answer and I can't find out how to work out the closing inventory in my notes!
  • Dahir AhmedDahir Ahmed Feels At Home Registered Posts: 63
    Opening Inventory + Purchases - Closing inventory = Cost of goods sold.
  • NpsNps Experienced Mentor Registered Posts: 782
    At the start of the year, there was £5,850 of inventory. During the year another £46,795 worth was purchased giving a total of £52,645 over the year. £47,925 of this was used as the cost of sales for the year, leaving £4,720 to be destroyed in the fire.
  • j1994j1994 Registered Posts: 106
    How do i calculate share of profit for one person?profit share is 40% at 162000
  • KkadijatKkadijat Registered Posts: 28
    The value destroyed OR closing inventory is calculated as:
    Opening inventory + purchases - sales
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