Page 96 - DCOM202_COST_ACCOUNTING_I

Cost Accounting – I

Notes Solution:
(a) FIFO Method:

Stores Ledger Account

date and Particulars Qty. Rate Amount date and Particulars Qty. Rate Amount
year Kg. (`) (`) year Kg. (`) (`)
2006 2006
Jan.3 To purchase 500 2.00 1000 Jan.19 By Issue 500 2.00 1000.00
Jan.18 To purchase 350 3.00 1050 By Issue 100 3.0 300.00
600
Jan.25 To purchase 600 2.50 1500 Jan.27 By Issue 250 3.00 750.00
By Issue 200 2.50 50.00
450
Feb.4 To purchase 500 2.75 1375 Feb.5 By Issue 400 2.50 1000.00
By Issue 100 2.75 275.00
500
Feb.7 By Issue 150 2.75 412.50
To Balance b/d 250 2.75 687.50
1950 4925 1950 4925.00
(b) LIFO Method:

Stores Ledger Account

date and Particulars Qty. Rate Amount date and Particulars Qty. Rate Amount
year Kg. (`) (`) year Kg. (`) (`)
2006 2006
Jan.3 To purchase 500 2.00 1000 Jan.19 By Issue 350 3.00 1050
By Issue 250 2.00 500
600
Jan.18 To purchase 350 3.00 1050 Jan.27 By Issue 450 2.50 1125
Jan.25 To purchase 600 2.50 1500 Feb.5 By Issue 500 2.75 1375
Feb.4 To purchase 500 2.75 1375 Feb.7 By Issue 150 2.50 375
To Balance b/d 250 2.00 500
1950 4925 1950 4925

Example: Following purchases were made of Iron pipes:
date Pipes Rate per pipe (`)
4 July 2007 20 15.00
th
17 July 2007 30 14.00
th
2 August, 2007 40 14.50
nd
th
30 August, 2007 30 13.00
The issues were:
date Pipes
20 July, 2007 75
th
5 August, 2007 40
th
st
31 August, 2007 45

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