Inventory elements: derecognition and measurementAt the time of their exit, the inventory and other fungible assets are measured and recorded in accountingthrough applying one of the following formulas:First In - First OutCFIFOWACWeighted Average CostLast In - First OutLIFOCase study no. 1: At the beginning of January N entity A has an initial flour inventory of 200 kg evaluatedat an actual cost of 46 lei/kg. The following transactions happen during the month with regard to the flourinventory:07.01.N: acquisition 500 kg, actual cost 47 lei/kg:09.01. N: acquisition 300 kg, actual cost 49 lei/kg:12.01. N: consumption 600 kg:17.01. N: consumption 100 kg:20.01. N: acquisition 200 kg, actual cost 55 lei/kg:24.01. N: consumption 400 kg:27.01. N: acquisition 700 kg, actual cost 57 lei/kg:30.01. N: consumption 750 kg. CEstablish the value of each flour consumption taking place during the month, the value of the monthly flourconsumption and the value of the closing flour inventory by applying the LIFO formula in the month of January.InventoryNo.DateQuantityEntriesCostper unitValue QuantityValueValueCostper unitQuantity83301.01.N Initial inventory07.01.N09.01 NPAPAPR12.01.N17.01.N20.01 N24.01 N8.27.01 N30.01.N31.01.NTotalThe value of monthly flour consumption is:The value of the closing flour inventory:K

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Description: Inventory elements: derecognition and measurementAt the time of their exit, the inventory and other fungible assets are measured and recorded in accountingthrough applying one of the following formulas:First In - First OutCFIFOWACWeighted Average Co

LIFO is last in first out, where inventory that is purchased at last and sold first.

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C. Establish the value of each flour consumption taking place during the month, the value of the monthly fi consumption and the value of the closing flour inventory by applying the LIFO formula in the month of January. Cit Exits Inventory No. Date Quantity Value Quantity Cost Value Quantity Value Entries Cost per unit 3 per unit 6 0 1 2 5 8 9 4= 2x 3 7=5x 6 1. 01.01.N Initial inventory 07.01 N 3. 09.01 N 4. 12.01.N 5. 17.01.N 6. 20.01 N 123 2.

C. Establish the value of each flour consumption taking place during the month, the value of the monthly fi consumption and the value of the closing flour inventory by applying the LIFO formula in the month of January. Cit Exits Inventory No. Date Quantity Value Quantity Cost Value Quantity Value Entries Cost per unit 3 per unit 6 0 1 2 5 8 9 4= 2x 3 7=5x 6 1. 01.01.N Initial inventory 07.01 N 3. 09.01 N 4. 12.01.N 5. 17.01.N 6. 20.01 N 123 2.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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