While preparing its draft final accounts for the year ended 31 July 24Y4 and its draft balance sheet as at 31 July 24Y4, ZAB Enterprises discovered a mistake in the stock lists used to value stock as at 31 July 24Y4 The entry was Stock item Number Cost per unit Total cost Q567 130 3 70 481 Required (a) Describe the error in this entry (b) Determine the effects of this error on (i) the value of stock as at 31 July 24Y4 (ii) the cost of goods sold for the year ended 31 July 24Y4 (iii) the net profit for the year ended 31 July 24Y4 (iv) the total for Current Assets as at 31 July 24Y4

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Question: While preparing its draft final accounts for the year ended 31 July 24Y4 and its draft balance sheet as at 31 July 24Y4, ZAB Enterprises

While preparing its draft final accounts for the year ended 31 July 24Y4 and its draft balance sheet as at 31 July 24Y4, ZAB Enterprises discovered a mistake in the stock lists used to value stock as at 31 July 24Y4. The entry was:

Stock item	Number	Cost per unit	Total cost
Q567	130	£3.70	£481

Required: (a) Describe the error in this entry. (b) Determine the effects of this error on: (i) the value of stock as at 31 July 24Y4. (ii) the cost of goods sold for the year ended 31 July 24Y4. (iii) the net profit for the year ended 31 July 24Y4. (iv) the total for Current Assets as at 31 July 24Y4.

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