A sole trader operates his business from a warehouse, which has been damaged by a fire, which occurred at the end of the financial year. After the fire, the remaining inventory that is undamaged amounts to GH₵ 2,000 (cost). The accountant establishes the following information: I Inventory at the beginning of the year was GH₵ 16,000 II Purchases during the year were GH₵ 115,000 III Sales during the year were GH₵ 140,000 IV The trader sells his goods at a mark-up of 25% of cost What is the value of the inventory lost in fire?
A sole trader operates his business from a warehouse, which has been damaged by a fire, which occurred at the end of the financial year. After the fire, the remaining inventory that is undamaged amounts to GH₵ 2,000 (cost). The accountant establishes the following information: I Inventory at the beginning of the year was GH₵ 16,000 II Purchases during the year were GH₵ 115,000 III Sales during the year were GH₵ 140,000 IV The trader sells his goods at a mark-up of 25% of cost What is the value of the inventory lost in fire?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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A sole trader operates his business from a warehouse, which has been damaged by a fire, which occurred at the end of the financial year. After the fire, the remaining inventory that is undamaged amounts to GH₵ 2,000 (cost). The accountant establishes the following information: I Inventory at the beginning of the year was GH₵ 16,000 II Purchases during the year were GH₵ 115,000 III Sales during the year were GH₵ 140,000 IV The trader sells his goods at a mark-up of 25% of cost What is the value of the inventory lost in fire?
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