ABSTRACT

In the course of audit work the following queries arose. Please identify for each item below what adjustment, if any, is needed to the closing stock figure; and calculate what the total closing stock should be in the final accounts. (a) Three items of china, with a total cost of £240, were cracked. The

manager thought they could be sold for £150 in total, instead of at the normal 100 per cent mark-up on cost.