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GCE Financial Accounting 1989 Question 45

Question 45

Manufacturing Accounts

Use the Manufacturing and Trading Accounts shown (X marks figures you must work out). What is the net sales for the period?

Diagram for this question
  1. A.₦175,000
  2. B.₦170,000
  3. C.₦165,000
  4. D.₦132,000
  5. E.₦114,000
Show the answer and explanation

Answer: C (₦165,000)

Explanation

Gross profit is 20% of sales, so cost of sales 132,000 is 80% of sales: 132,000 ÷ 0.8 = ₦165,000.