Accounting Multiple Choice Question – 2 April 2020

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

Accounting

The following information relates, to a sole trader whose financial year ends on 31 December.

  • Sales for the period 1 January – 31 December – £200,000
  • Purchases for the period 1 January – 31 December – £130,000
  • Stock at 1 January – £50,000
  • Percentage mark-up applied on all goods during the period 1 January – 31 December was 25%

The sole trader’s stock as at 31 December, at cost, was?

Select ONE answer:

  1. £20,000
  2. £26,000
  3. £40,000
  4. £70,000

 

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 1

  1. Correct – Cost of sales + 25% = £200,000 Therefore, Cost of sales = £160,000. Cost of sales = Opening stock + purchases – closing stock. Therefore, £160,000 = £50,000 + £130,000 – closing stock. Therefore, closing stock = £20,000
  2. Not correct
  3. Not correct
  4. Not correct

 

 

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Author: stuart001uk2014

Referral marketing, business, economics and accounting s​pecialist & corporate mentor

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