ACCA F3 Mock Exam Inventory
A fire on 30 September destroyed some of a company’s inventory and its inventory records.
The following information is available:
Inventory 1 September $600,000
Sales for September $50,000
Purchases for September $300,000
Inventory in good condition at 30 September $40,000
Standard gross profit percentage on sales is 25%
Based on this information, what is the value of the inventory lost?
ACCA F3 Mock Exam Inventory
Suggested Solution:
| Inventory 1 September | 600,000 |
| Plus Purchses for September | 300,000 |
| Minus Cost of Sales | 37,500 |
| Closing inventory | 862,500 |
| Inventory in good condition at 30 September | 40,000 |
| Closing inventory | 862,500 |
| value of the inventory lost | 822,500 |
Note
COS = Sales * (1-0.25)
=Sales X 0.75
=50000 X 0.75
=37500