A sole trader operates his business from
a warehouse, which has been damaged
by a fire, which occurred at the end of
the financial year. After the fire, the
remaining inventory that is undamaged
amounts to GHC 2,000 (cost). The
accountant establishes the following
information: I Inventory at the
beginning of the year was GHC 16,000 II
Purchases during the year were GHC
115,000 III Sales during the year were
GHC 140,000 IV The trader sells his
goods at a mark-up of 25% of cost What
is the value of the inventory lost in fire?