Multiple choice

The stocks that are lying unsold with the consignee under a consignment sale are valued at

  1. cost price of the stock

  2. sale price of the stock

  3. cost price + recurring and non-recurring expenses incurred by the consignee

  4. cost price + non-recurring expenses incurred by the consignee and the consignor
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Closing stock is always valued at cost price + direct expenses or market price, whichever is less. Since there is no indication of reduction in the market price of goods in the given question, so option 4 is correct.

Keep practicing — related questions