ACCA Applied Knowledge (BT, MA, FA) · Financial Accounting (FA)

Inventories

7 practice questions, each with the answer and an explanation.

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Random questions from this topic, one at a time. You see the answer and the explanation straight after each one.

All 7 questions

  1. A business holds the following movements for one product: opening inventory 100 units at £5, then purchases of 200 units at £6 and 150 units at £7. In the period 320 units are sold. Using the FIFO met…
  2. Using the same data (opening 100 units at £5, purchases of 200 at £6 and 150 at £7, with 320 units sold), what is closing inventory at the weighted average cost method calculated once for the whole pe…
  3. At the year end a trader has three product lines. Line A: 100 units, cost £40, selling price £55, selling costs £18 per unit. Line B: 200 units, cost £25, selling price £60, selling costs £10 per unit…
  4. Which of the following costs should be included in the cost of inventories of finished goods under IAS 2?
  5. A business has an opening inventory of £14,200, purchases of £86,500, purchase returns of £2,300 and carriage inwards of £1,800. Closing inventory is £16,900. What is the cost of sales?
  6. A trader's inventory count at the year end shows £52,400 at cost. The count includes goods that cost £3,000, which were damaged. They can be sold for £2,100 after £400 of repair costs. What is the rev…
  7. A business uses the perpetual weighted average cost method, recalculating the average after each purchase. It holds 100 units at £10 and buys 100 units at £12. It then issues 150 units, buys 150 units…

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