2018: Question 6

6.1 REQUIRED: Calculate the value of closing inventory as at 31 December 2018 and gross profit for the year ended 31 December 2018 using the weighted average cost method. (10)

Use the format of the Statement of Comprehensive Income to present your answer.

INFORMATION: Officesupp Limited, a supplier of office accessories, inventory records are presented in the table below:

Closing inventory of 80 units at R150 each on 31 December 2017 70 units at R170 were purchased on 30 April 2017 60 units at R180 were purchased on 30 June 2017 90 units at R190 were purchased on 30 August 2017 During the year (Jan-Dec 2018) 240 units were sold at R300 each

6.2

REQUIRED: Use the information given below to answer the following questions: 6.2.1 Calculate the profit that Telepoint Ltd would make if the account is settled within 15 days. (7) 6.2.2 Should the customer fail to pay the amount due and the account is written off after 90 days, what would be the loss to the firm? (3)

INFORMATION: Telepoint Ltd is considered selling a television to a customer on credit. The cost of the television is R12 000 and the selling price is R16 000. A credit term of 2/15 net 60 days was agreed upon. The cost of capital of Telepoint Ltd is 12%.