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Hello sir im having a problem in sec B but only a part i don’t understand.
This is the question.
The following is an extract from Diaz co trial balance as at 31dec 20X8 :
INVENTORY AT 31DEC debit $8.6m
TRADE RECEIVABLES debit: $6.2m
5%LOAN NOTES credit $9m
The inventory count was completed on 31 december 20X8 but two issues have been noted. First, product with a sales values of $0.6m had been incorrectly excluded from the count. Second, items costing $0.2m which had been included in the count was damaged and could only be sold for 50% of normal selling price. Diaz co makes a profit markup of 50%on both these items.
What is the correct amount of inventory to be recognised in diaz co financial statement as at 31dec 20X8?
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