Paper 2 · June 2010 · Partnership Accounts
A business sold 2 950 units for $442 500. Its opening inventory of finished goods at transfer value was $24 000, goods transferred in from the factory during the year were $360 000, and closing inventory of finished goods at transfer value was $30 000. Calculate the gross profit for the year.
A$28 500
B$76 500
C$82 500
D$88 500
Explanation
Cost of sales = opening $24 000 + transfers $360 000 - closing $30 000 = $354 000. Gross profit = $442 500 - $354 000 = $88 500. Ignoring both inventories gives $82 500, and reversing them gives $76 500.
Derived from ZIMSEC Accounting 9197/2 Paper 2, June 2010, Q1