- This topic has 1 reply, 2 voices, and was last updated 3 years ago by
.
Viewing 2 posts - 1 through 2 (of 2 total)
- Posts
On 30 September 20X4 Razor’s closing inventory was counted and valued at its cost of
$1 million.
This included some items of inventory which had cost $210,000 and had been damaged in a
flood on 15 September 20X4. These are not expected to achieve their normal selling price
which is calculated to achieve a gross profit margin of 30%.
The sale of these goods will be handled by an agent who sells them at 80% of the normal
selling price and charges Razor a commission of 25%.
At what value will the closing inventory of Razor be reported in its statement of financial
position as at 30 September 20X4?Why do we deduct the expected loss from $1 million to arrive at the final answer?
Viewing 2 posts - 1 through 2 (of 2 total)
- You must be logged in to reply to this topic.