Question 1
The following is summary of the receipts and issues of materials in a factory during Janu
2022. Calculate the value of the closing stock using the FIFO and LIFO method
Receipts:
Jan 1: 10,000 units @ $2.00
Jan 10: 5,000 units @ $2.50
Jan 20: 8,000 units @ $3.00
Issues:
Jan 5: 6,000 units
Jan 15: 4,000 units
Jan 25: 7,000 units
Answer:
FIFO:
Closing Stock = (10,000 units x $2.00) + (5,000 units x $2.50) = $30,000
LIFO:
Closing Stock = (8,000 units x $3.00) + (2,000 units x $2.50) = $26,000