Hello sir! Can you please help me with this question?
Catt sells goods at a margin of 50%. During the year to 31 March 20X3 the business made purchases totalling $134,025 and sales totalling $240,000. Inventories in hand at 31 March 20X3, valued at cost, was $11,385 higher than the corresponding figure at 1 April 20X2.
What was the cost of the goods Catt had drawn out?
A $2,640
B $14,590
C $25,410
D $37,360
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34.14
5y ago#1The cost of sales was 50% x 240,000 = $120,000.
Of the purchases figure of 134,025, 11,385 went to increasing the inventory, which leaves $122,640.
Therefore the owner must have taken out 122,640 - 120,000 = $2,640.
Thank you!
5y ago#3You are welcome :-)
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