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WAEC Financial Accounting 2024 Question 8

Question 8

Incomplete Records

Use the following information to answer questions 7 to 9.
Opening stock: Le 6,000
Sales: Le 180,000
Closing stock: Le 4,200
Mark-up is 33⅓%
The cost of goods sold is

  1. A.Le 139,200
  2. B.Le 135,000
  3. C.Le 133,200
  4. D.Le 127,200
Show the answer and explanation

Answer: B (Le 135,000)

Explanation

A mark-up of 1/3 on cost means sales = 4/3 of cost, so cost = 180,000 × 3/4 = Le 135,000.