Neco Model Questions Vol1 2021 Financial Accounting Question 27

A merchandising firm provides the following information for the year ended 31 December 2021:\n\n- Opening stock: \(\text{₦}480,000\)\n- Closing stock: \(\text{₦}540,000\)\n- Sales (credit): \(\text{₦}2,340,000\)\n- Sales returns: \(\text{₦}120,000\)\n- Cash receipts from customers: \(\text{₦}2,100,000\)\n- Trade discounts allowed: \(\text{₦}30,000\)\n- Gross profit rate: 25 % of net sales\n\nThe trial balance shows the following debit balances: Cash \(\text{₦}200,000\), Accounts Receivable \(\text{₦}150,000\), Purchases (missing), Purchase Returns \(\text{₦}40,000\), Freight In \(\text{₦}25,000\). Credit balances are: Sales \(\text{₦}2,340,000\), Sales Returns \(\text{₦}120,000\), Accounts Payable \(\text{₦}210,000\), Capital \(\text{₦}500,000\).\n\nDetermine the amount that should be recorded in the Purchases account.