1/5/07 Purchased 100 bags of milk at #10.00k each 3/5/07 Purchased 60 bags of milk at #11.50k each 15/5/07 Issued 85 bags of milk 15/5/07 Purchased 180 bags of milk at #12.80K each 22/5/07 Issued 145 bags of milk. Using simple average method, calculate the value of stock after 22/5/07
A. #1,198.00 B. #1,218.38 C. #1,257.67 D. #1,408.00
Correct Answer: C
Explanation
date
quantity
unit cost
Dispatch quantity
Balance
1
100
10.00
Â
100
3
60
11.50
Â
60
15
Â
Â
85
75
15
180
12.80
Â
255
22
Â
Â
145
110
Â
340
34.3
230
110
(34.3 / 3) x 110 = 1257.67 The value of stock is gotten by dividing the total unit cost by the number of times stock was purchased and multiplying it by the balance of stock at the end of the month or period.
