Gigabyte Ltd. bought an item of inventory on 1 October 2018 for £4,000. On 30 September 2019, the same piece of inventory would have cost the company £6,000. The company sells the piece of inventory for £8,000 on 30 September 2020. On 1 October 2020, the same piece of inventory would have cost the company £7,000. Under replacement cost accounting, which of the following would be recognised as income by the company? Income of £2,000 at 30 September 2019; Income of £2,000 at 30 September 2020 O b. No income at 30 September 2019; Income of £4,000 at 30 September 2020 Income of £4,000 at 30 September 2019; No income at 30 September 2020 O d. Income of £2,000 at 30 September 2019; Income of £2,000 at 30 September 2020
Gigabyte Ltd. bought an item of inventory on 1 October 2018 for £4,000. On 30 September 2019, the same piece of inventory would have cost the company £6,000. The company sells the piece of inventory for £8,000 on 30 September 2020. On 1 October 2020, the same piece of inventory would have cost the company £7,000. Under replacement cost accounting, which of the following would be recognised as income by the company? Income of £2,000 at 30 September 2019; Income of £2,000 at 30 September 2020 O b. No income at 30 September 2019; Income of £4,000 at 30 September 2020 Income of £4,000 at 30 September 2019; No income at 30 September 2020 O d. Income of £2,000 at 30 September 2019; Income of £2,000 at 30 September 2020
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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