Day: June 14, 2023

Accounting Multiple Choice Question – 14 June 2023

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

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Alex plc buys items for resale at a cost of £15 per unit.

They are normally sold for £22.

A damaged unit can only be sold at the normal selling price after modifications costing £14 are made by Alex plc.

The scrap value of the item is £7 per unit.

How much should the damaged unit be valued at in the balance sheet?

Select ONE answer:

  1. £7
  2. £8
  3. £14
  4. £15

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 2

  1. Not correc
  2. Correct – Lower of cost and NRV = = > Cost £15 vs NRV (£22 – £14) of £8
  3. Not correct
  4. Not correct

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