Edexcel IGCSEAccountingGeneral Applications8 Marks
The following information relates to the inventory of Product X held by RST Retailers during March 2026:
- (a)Inventory on 1 March: 100 units @ $5.00 per unit Purchases: 10 March: 150 units @ $5.20 per unit 20 March: 80 units @ $5.50 per unit Sales: 15 March: 120 units 25 March: 180 units Using the First-In, First-Out (FIFO) method, calculate the value of closing inventory on 31 March 2026.[4]
- (b)On 31 March 2026, RST Retailers also had the following balances: Trade receivables: $7 500 Bank balance (debit): $2 100 Prepayments: $400 Accrued expenses: $250 Prepare the Current Assets section of the Statement of Financial Position for RST Retailers as at 31 March 2026. (Use the inventory value calculated in (a).)[4]
Mark scheme
Marking points from the official mark scheme. The mark or mark type is shown in brackets.
- (a) Total units available = 100 + 150 + 80 = 330 units
- Total units sold = 120 + 180 = 300 units
- Closing inventory units = 330 - 300 = 30 units (1)
- FIFO layers for closing inventory (last in, remaining): 30 units @ $5.50 (from 20 March purchase) (1)
- Value = 30 x $5.50 = $165 (2) (M1 for correct price application, A1 for final correct answer)
- (b) RST Retailers (1)
- Statement of Financial Position (Extract) (1)
- As at 31 March 2026
- Current Assets:
- Inventory (1) $165 (1) (value carried forward from (a))
- Trade receivables (1) $7 500 (1)
- Bank (1) $2 100 (1)
- Prepayments (1) $400 (1)
- Accrued expenses is a current liability and should not be included here.
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