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6 marksCorrection of Errors and the Suspense Account

CSEC Principles of Accounts · January 2014 · Paper 2 · Question 2(a)

Go-Low Ltd calculated ending inventory as 65 400 at 31 December 2013 before errors were discovered: an inventory sheet was overstated by 250; a sheet total of 4 657 was listed as 4 567 on summary sheet; free samples sent by a supplier were included at a cost of 75; purchases of 400 on 27 December 2013 were omitted from the count.

Prepare a statement showing the correct inventory figure for the year ended 31 December 2013, showing clearly the effect of EACH item.

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Other parts of this question

  1. 2(b)Complete the stock valuation worksheet to calculate the value of ending inventory for Go-Low Ltd using the LIFO method.[13 marks]
  2. 2(c)State whether the value of ending inventory would be higher or lower if Go-Low had used the FIFO method.[1 mark]

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