Question

A consigned goods of Rs. $20,000$ to M and paid Rs. $1,000$ for expense. The consignee paid Rs. $200$ for freight and Rs. $100$ for octroi. $80\%$ of goods was sold and commission of Rs. $1,000$ was paid. Value of closing stock $=$?

• A. Rs. $4,200$
• B. Rs. $4,000$
• C. Rs. $4,260$
• D. Rs. $5,200$

Answer 1

The correct option is C Rs. $4,260$

Value of Closing Stock = Cost + Proportional Expenses = 20% [Rs. 20,000 + {Rs. 1,000(expense) + Rs. 200(freight) + Rs. 100(octroi)} = 20% [Rs. 20,000 + Rs. 1,300] = 20% (Rs. 21,300) = Rs. 4,260.

Note: Since 80% of the goods were sold, 20% of the goods remain as closing stock.