Products
Rewards 
from HOLOOLY

We are determined to provide the latest solutions related to all subjects FREE of charge!

Please sign up to our reward program to support us in return and take advantage of the incredible listed offers.

Enjoy Limited offers, deals & Discounts by signing up to Holooly Rewards Program

HOLOOLY 
BUSINESS MANAGER

Advertise your business, and reach millions of students around the world.

HOLOOLY 
TABLES

All the data tables that you may search for.

HOLOOLY 
ARABIA

For Arabic Users, find a teacher/tutor in your City or country in the Middle East.

HOLOOLY 
TEXTBOOKS

Find the Source, Textbook, Solution Manual that you are looking for in 1 click.

HOLOOLY 
HELP DESK

Need Help? We got you covered.

Chapter 3

Q. 3.1

At the end of its financial year, a lady’s fashion business has 500 green handbags
which cost the company £10 each. The normal selling price of a handbag is £25,
but due to fashion changes, no one wants to buy green handbags. The company is
now only able to sell yellow handbags. The only chance of selling green handbags
is to add a yellow strap at a cost of £2 per handbag and to reduce the selling price to
£8 each. What is the closing value of inventory?

Step-by-Step

Verified Solution

The closing inventory of green handbags would be valued at:

(500 \times £8 ) – (500 \times £2 )= £3,000.

Note that neither the original cost price nor the ‘normal’ selling price are relevant to
the calculation in this example.