A-LevelAccountingPreparation of financial statements9706/12 · May/June 2011 · Q51 Mark

At the year end a company discovers that some inventory is damaged. This inventory originally cost $2000 and to replace it would now cost $1900. It would normally sell for $2400 but can now only be sold for $2200 if repairs costing $400 are undertaken. At what value should the damaged inventory be shown in the financial statements?

A$1800

B$1900

C$2000

D$2200

✓ Correct answer

A: $1800

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Topic: Preparation of financial statements, A-Level Accounting (syllabus 9706). Multiple choice, 1 mark.
Source: A-Level Accounting, May/June 2011 Paper 1 Variant 2, question 5.

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