IGCSE/GCSE/O & A Level/IB/University Student Forum

Qualification => Subject Doubts => GCE AS & A2 Level => Commerce => Topic started by: avin on September 28, 2011, 11:15:10 pm

Title: Accounting , pls help me
Post by: avin on September 28, 2011, 11:15:10 pm

The Purchases and Sales history for the past four months is as follows:

                              Grand Harps                   Modern Harps              Total
Purchased               2 at $6,500 each            20 at $1,200 each       $37,000
Sold                      1 at $10,000 each           18 at $2,500 each       $55,000

Opening Inventory
As at 1May 2011      1 at $6,500 each             2 at $1,200 each        $8,900 *
*Note: The opening inventory as at 1 May 2011 is included in the Purchases account of $37,000.


The business starts in January 2011 and end in 31 May 2011 and using Periodic FIFO inventory system.

The trial balance at 1 May 2011, purchase account is $37,000 and no inventory account.


1) why is the opening stock in 1 May 2011 of $8,900 is different from the trial balance of $37,000? What I need to do?

2) Is the following 2 items correct?

  Cost of sales= (1 x $6,500) + (2 x $ 1,200) = $8,900
  Closing inventory= (1 x $6,500)+ (18 x $1,200) = $ 28,100


Thanks for your reply.

Title: Re: Accounting , pls help me
Post by: Dasith on October 12, 2011, 02:49:39 pm

could you please post the original question please , your explanation & questions seems to be unclear

Title: Re: Accounting , pls help me
Post by: avin on October 31, 2011, 02:33:16 pm

Thanks Dasith !!

I got it already. I interpreted wrongly.