"Calculate the value of closing stock from the following according to FIFO method:1st January, 20XX: Opening balance: 50 units @ Rs 4Receip… — Answer & Discussion

"Calculate the value of closing stock from the following according to FIFO method:1st January, 20XX: Opening balance: 50 units @ Rs 4Receipts:5th January, 20XX: 100 units @ Rs 512th January, 20XX: 200 units @ Rs 4.50Issues:2nd January, 20XX: 30 units18th January, 20XX: 150 units"

ARs. 765
BRs. 805
CRs. 786
DRs. 700

Correct answer: A

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Discussion 1

CCommunity31 May 2021

Rs. 765

Calculation of Closing Stock:
1st January, 20XX: Opening balance: 50 units @ Rs 4 = 50 × 4 = Rs. 200
Issue: 2nd January, 20XX: 30 units = 30 × 4 = Rs. 120
Remaining Stock = (50 - 30) × 4 = Rs. 80
Reciept: 5th January, 20XX: 100 units @ Rs 5 = 100 × 5 = Rs. 500
Reciept: 12th January, 20XX: 200 units @ Rs 4.50 = 200 × 4.5 = Rs. 900
Remaining Stock = Rs. 80 + Rs. 500 + Rs. 900 = Rs. 1480
Issue: 18th January, 20XX: 150 units = (20 × 4) + (100 × 5) + (30 × 4.5) = Rs. 80 + Rs. 500 + Rs. 135 = Rs. 715
Remaining Stock = (200 - 30) × 4.5 = Rs. 765.