JAMB Accounting 2020 Objective — Question 3
Question 3 of 40 from the Joint Admissions and Matriculation Board (JAMB) Accounting 2020 Objective paper, with the correct answer and a full explanation.
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3. Use the following information to answer question 3 and 4: Ibikunle ltd. has the following records: Stock 1/1/19 N500, Sales N15,000, Purchases N7,000, Stock 31/12/19 N900. Director withdrew goods that worth N600. Calculate mark-up for the business
- A. A. 50%
- B. B. 100%
- C. C. 150%Correct
- D. D. 20%
Explanation
Cost of goods sold = Opening stock + Purchases - Director's withdrawal - Closing stock = 500+7000-600-900 = 6000. Profit = Sales - COGS = 15000-6000 = 9000. Mark-up = Profit/Cost of sale = 9000/6000 = 150%.
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