JAMB Accounts Principles of Accounts 2010 Paper

Concept:Cost of goods available for sale includes all costs incurred to make goods ready for sale before deducting closing stock.Explanation:Start with opening stock.Add purchases and carriage inwards (cost of bringing goods in).Subtract returns outwards (purchases returned to supplier).Do not include returns inwards, carriage outwards, or closing stock at this stage.Cost of goods available for sale:$1{,}000 + 4{,}000 + 200 - 800 = 4{,}400$$\text{Opening stock } N1{,}000$$\text{Purchases } N4{,}000$$\text{Add: Carriage inwards } N200$$\text{Less: Returns outwards } (N800)$$\text{Cost of goods available for sale } = N4{,}400$Answer:D. N4,400