JAMB Accounting 2009 Objective — Question 29

Question 29 of 50 from the Joint Admissions and Matriculation Board (JAMB) Accounting 2009 Objective paper, with the correct answer and a full explanation.

29. WIP 1/1 #1,000; WIP 31/12 #2,000; Production cost of goods manufactured #20,000; Sales #50,000; Stock of finished goods 1/1 #4,000; Stock of finished goods 31/12 #5,000; Selling and distribution expenses #2,000; Administrative expenses #1,000. Determine the gross profit.

A. #49,000
B. #48,000
C. #31,000Correct
D. #30,000

Explanation

Cost of goods sold = (Opening finished stock 4,000 + Cost of goods manufactured 20,000) - Closing finished stock 5,000 = 19,000. Gross profit = 50,000 - 19,000 = #31,000.

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