JAMB Principles of Accounts 2002 Question 2

Question 2

Final Accounts of a Sole Trader

Given:
(₦)
Stock (1/4/94) 800
Purchases of flour 2450
Sales 4745
Wages of bakery staff 675
Carriage outwards 50
Salary of administrative staff 225
Stock (31/3/95) 940
Capital 1540
Determine the cost of goods sold

A.₦2575
B.₦2985
C.₦3250
D.₦3925

Show the answer and explanation

Answer: B (₦2985)

Explanation

Cost of goods sold = opening stock 800 + purchases 2 450 + bakery (production) wages 675 − closing stock 940 = ₦2 985.