Day: September 19, 2022

Inventory should be valued at the lower of cost and net realisable value.

The table shows data about four products.

• Product W – Cost £18 & Realisable Value £15 & Selling Expenses £0
• Product X – Cost £19 & Realisable Value £28 & Selling Expenses £3
• Product Y – Cost £17 & Realisable Value £17 & Selling Expenses £2
• Product Z – Cost £23 & Realisable Value £26 & Selling Expenses £3

At how much should the total stocks be valued?

Select ONE answer:

1. £72
2. £77
3. £78
4. £86

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 – £15 + £19 + £15 + £23
2. Not correct
3. Not correct
4. Not correct

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