SSC CGL Finance – Valuation of Inventories – Exam-Level Drill
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COGS 2,40,000 = 40,000 + P − 50,000 → P = 2,50,000.
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SSC CGL Finance – Valuation of Inventories – Exam-Level Drill – 10 questions, subject: Finance & Economics (Tier II Paper III). Every question has the correct answer with a one-line explanation; tap "Show Answer". Free practice for TNPSC, UPSC, SSC, Bank and RRB exams – Shanmugam IAS Academy, Coimbatore.
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1.
Shree Textiles' closing stock: P 400 units, cost ₹ 120, NRV ₹ 150 each; Q 250 units, cost ₹ 200, NRV ₹ 170 each; R 500 units, cost ₹ 60, selling price ₹ 75 with selling costs ₹ 9 each; S 100 units, cost ₹ 300, selling price ₹ 320, cost to complete ₹ 40 and selling cost ₹ 10 each. The value of inventory under AS 2 is:
Correct Answer: A [₹ 1,47,500]
Explanation:
48,000 + 42,500 + 30,000 + 27,000 = 1,47,500.
2.
Shree Textiles' closing stock: P 400 units, cost ₹ 120, NRV ₹ 150 each; Q 250 units, cost ₹ 200, NRV ₹ 170 each; R 500 units, cost ₹ 60, selling price ₹ 75 with selling costs ₹ 9 each; S 100 units, cost ₹ 300, selling price ₹ 320, cost to complete ₹ 40 and selling cost ₹ 10 each. The total write-down to NRV is:
Correct Answer: B [₹ 10,500]
Explanation:
Answer: ₹ 10,500. Q 7,500 + S 3,000 = 10,500.
3.
Shree Textiles' closing stock: P 400 units, cost ₹ 120, NRV ₹ 150 each; Q 250 units, cost ₹ 200, NRV ₹ 170 each; R 500 units, cost ₹ 60, selling price ₹ 75 with selling costs ₹ 9 each; S 100 units, cost ₹ 300, selling price ₹ 320, cost to complete ₹ 40 and selling cost ₹ 10 each. The NRV per unit of S is:
Correct Answer: D [₹ 270]
Explanation:
Answer: ₹ 270. 320 − 40 − 10 = 270.
4.
Shree Textiles' closing stock: P 400 units, cost ₹ 120, NRV ₹ 150 each; Q 250 units, cost ₹ 200, NRV ₹ 170 each; R 500 units, cost ₹ 60, selling price ₹ 75 with selling costs ₹ 9 each; S 100 units, cost ₹ 300, selling price ₹ 320, cost to complete ₹ 40 and selling cost ₹ 10 each. Which items are written down?
Correct Answer: C [Q and S only]
Explanation:
R's NRV 66 > cost 60; P's 150 > 120.
5.
Shree Textiles also holds raw material costing ₹ 20,000 (replacement cost ₹ 17,000) to be used for product P, which sells above cost. The raw material is valued at:
Correct Answer: A [₹ 20,000]
Explanation:
Finished product sells above cost → no write-down (AS 2 para 24).
6.
Raw material costing ₹ 16,000 (replacement cost ₹ 14,000) will be used for a product that is expected to sell below its cost. The raw material is best valued at:
Correct Answer: B [₹ 14,000]
Explanation:
Write down; replacement cost may be the best measure of NRV (para 24).
7.
A shop's closing stock at selling price is ₹ 3,60,000. Goods are marked up 25% on cost. Cost of the closing stock (retail method) is:
Correct Answer: D [₹ 2,88,000]
Explanation:
3,60,000 × 100/125 = 2,88,000.
8.
Two-quantity comparisonOpening 120 units @ ₹ 36; purchased 80 units @ ₹ 16; sold 140 units (prices falling).
Quantity I: closing stock under FIFO
Quantity II: closing stock under periodic weighted average
Quantity I: closing stock under FIFO
Quantity II: closing stock under periodic weighted average
Correct Answer: B [Quantity I < Quantity II]
Explanation:
60 units left. QI = 60 × 16 = 960; average cost (4,320 + 1,280)/200 = 28 → QII = 60 × 28 = 1,680.
9.
Assertion–Reason
A: LIFO is not used under AS 2 for ordinarily interchangeable items.
R: AS 2 requires the cost of such items to be assigned using FIFO or the weighted average cost formula.
A: LIFO is not used under AS 2 for ordinarily interchangeable items.
R: AS 2 requires the cost of such items to be assigned using FIFO or the weighted average cost formula.
Correct Answer: C [Both A and R are true and R explains A]
Explanation:
AS 2 para 16 names only FIFO and weighted average.
10.
Reverse questionOpening stock ₹ 40,000; closing stock ₹ 50,000; sales ₹ 3,00,000; gross profit 20% on sales. Purchases were:
Correct Answer: A [₹ 2,50,000]
Explanation:
COGS 2,40,000 = 40,000 + P − 50,000 → P = 2,50,000.
➤ Full notes, shortcuts and every answer explained – SSC CGL 2026 Finance & Economics (Tier II Paper III) book (₹149): www.shanmugamiasacademy.in/study-materials/ssc-cgl-finance-economics
📘 SSC CGL 2026 – General Studies – Finance & Economics (Tier II Paper III)
Here you get the answer with a one-line explanation. 1,064 original questions with worked answers · Part A Finance & Accounts and Part B Economics & Governance notes · practice sets + 3 mock tests
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