Q.6 A Company made the following materials purchases and issues during January: Units Price Inventory Jan. 1" Receipts: 500- Rs. 1.20 (1) Jan. 6th 200 Rs. 1.25 (2) Jan. 10th 400 Rs. 1.30 (4) Jan. 25th 500 Rs. 1.40 Issues: (3) Jan. 15th 560 units (5) Jan. 27th 400 units Required: Compute the Cost of material consumed, and Cost assigned to the Inventory at the end of month, using a Perpetual Inventory System with each of the following: (a) FIFO Costing (b) LIFO Costing (c) Average Costing

Q.6 A Company made the following materials purchases and issues during January: Units Price Inventory Jan. 1" Receipts: 500- Rs. 1.20 (1) Jan. 6th 200 Rs. 1.25 (2) Jan. 10th 400 Rs. 1.30 (4) Jan. 25th 500 Rs. 1.40 Issues: (3) Jan. 15th 560 units (5) Jan. 27th 400 units Required: Compute the Cost of material consumed, and Cost assigned to the Inventory at the end of month, using a Perpetual Inventory System with each of the following: (a) FIFO Costing (b) LIFO Costing (c) Average Costing

Name: Q.6A Company made the following materials purchases and issues during
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Description: Q.6A Company made the following materials purchases and issues during January:UnitsPriceInventory Jan. 1"Receipts:500-Rs. 1.20(1) Jan. 6th200Rs. 1.25(2) Jan. 10th400Rs. 1.30(4) Jan. 25th500Rs. 1.40Issues:(3) Jan. 15th560 units(5) Jan. 27th400 unitsR

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Concept explainers

Inventory Valuation

Before discussing the topic inventory valuation let’s discuss the meaning of inventory. In accounting, inventory is also known as stock. Inventory means all the finished goods, materials, merchandise that a business holds for the purpose of selling it in the market with the motive of earning profit.

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Question

Q.6
A Company made the following materials purchases and issues during January:
Units
Price
Inventory Jan. 1"
Receipts:
500-
Rs. 1.20
(1) Jan. 6th
200
Rs. 1.25
(2) Jan. 10th
400
Rs. 1.30
(4) Jan. 25th
500
Rs. 1.40
Issues:
(3) Jan. 15th
560 units
(5) Jan. 27th
400 units
Required: Compute the Cost of material consumed, and Cost assigned to the
Inventory at the end of month, using a Perpetual Inventory System with each of the
following:
(a) FIFO Costing
(b) LIFO Costing
(c) Average Costing

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Step 4 b) Computation of ending inventory and cost of goods sold by LIFO method

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Step 6 c) Computation of ending inventory and cost of goods sold by Weighted average method

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