Question

X sent out 1000 bags to Y costing Rs 400 each at an invoice price of Rs 500 each.Consignor's A/c expenses are Rs 4,000.Consignee's non-selling expenses Rs 1,000, Selling expenses Rs 2,000. 800 bags were sold. Determine the amount of stock reserve?

• A. Rs. 20,000
• B. Nil
• C. Rs. 40,000
• D. Rs. 40,800

Answer 1

The correct option is A Rs. 20,000

Calculation of Unsold Units = 1000-800

= 200 units.

Calculation of stock Reserve = 200*100 (500-400)

=20000 Rs.