COSTING FOR MATERIAL ISSUES

Material issue or issuance is a term used to describe the movement of material from the store to
various production departments. The issue of stock needs to be recorded in a Store Ledger Card.
When store department issued material to production the issue must be valued or priced because it
will affect the cost of the products produced by production department. This may be difficult to do so
because the same type of material may have been purchased at seven different prices. The basic
problem in valuing material issues in production department is to decide which price to be used.
物料发放或发放是一个术语，用于描述物料从仓库到各个生产部门的移动。存货的发放需要记
录在存货总账卡上。当仓库部门向生产部门发放材料时，必须对材料进行估价或定价，因为它
会影响生产部门生产产品的成本。这可能很难做到，因为同一种材料可能以七种不同的价格购
买。生产部门评估材料问题的基本问题是决定采用哪种价格。

Store Ledger Card

A store ledger card is a document that records the receipts and issues of material on a continuous
basis whereby the stock balance is updated after each transaction. Any material returns or stock
losses will also be recorded in the card. A typical store ledger card has the following format: 存货分类
帐卡是一种连续记录材料的收付和发放的文件，每次交易后存货余额都会更新。任何材料退货
或库存损失也将记录在卡片上。典型的商店总账卡有以下格式:

RECEIPTS ISSUES BALANCE

Cost Cost Cost
Date Particulars
Quantity per RM Quantity per RM Quantity per RM
unit unit unit
1feb Opening stock 285 21.00 5,985

Methods of Stock Valuation

There are three methods of valuing issuance of stock that can answer the above questions namely.
1. First-In-First-Out
2. Last-In-First-Out
3. Weighted Average Cost methods

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Treatment of Material Returns 物料退货处理

There are two types of material returns which need to be carefully recorded: 需要仔细记录的物料退货
有两种:

1. Return from Production to Store (Return Inwards) 从生产返回仓库(向内返回)

a) Will be recorded as ‘receipts’ but its value will not be included in the calculation of cost of
material purchased. 记录为“收据”，但其价值不计入采购材料成本的计算。
b) Return at the price when issued. 按发行时的价格返还。

2. Return from Store to Supplier (Return Outwards) 从商店向供应商退货(向外退货)

a) Will be recorded as an “issue” but its value will not be included in the calculation of a cost
of material issued. 将被记录为“问题”，但其价值不包括在材料成本的计算中。
b) Return at the price when purchased 按购买时的价格退货

Treatment of Stock Losses 存货损失处理

Sometimes the balance of stock in the record is not same as the physical balance. This is called stock
losses. Stock losses will be adjusted in the store ledger card in the issue column. The quantity of stock
loss will be the difference between the balance of stock in the record and the physical balance found
during stock taking. 有时，记录中的存货余额与实物余额并不相同。这被称为股票损失。存货损
失将在发行栏的店铺总账卡中进行调整。存货损失的数量将是记录中的存货余额与盘点时发现
的实物余额之间的差额。

Effect of Valuation Method on Profit 估值方法对利润的影响

The use of the valuation methods may lead to different effect on the stock valuation. This will then
affect profit as follows: 不同的估值方法对股票估值的影响不尽相同。这将对利润产生如下影响:

In situation of rising material prices: 在材料价格上涨的情况下

1. FIFO will lead to highest profit FIFO 将带来最高的利润

2. LIFO will result in least profit 后进先出的利润最少

When material price is increasing, the use of FIFO will result in low cost of goods sold. This in turn will
cause profit to be high if compared to using LIFO. LIFO will lead to high cost of goods sold and
therefore will cause profit to be lower. 在物料价格上涨的情况下，采用先进先出法可以降低销售
成本。这反过来又会导致利润高，如果使用后进先出。后进先出会导致销售成本高，因此会导
致利润降低。

On the other hand, in cases of reducing material prices: 另一方面，在降低材料价格的情况下:

1. FIFO will lead to lowest profit FIFO 将导致最低的利润

2. LIFO will lead to highest profit 后进先出将带来最高的利润

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Example 1 - FIFO, LIFO and WACM

Wira Sdn Bhd produces hand and body lotion that uses aloe vera as its main ingredient. Due to lack of
spare storage, Wira Sdn Bhd has to purchase aloe vera throughout the year. Below are the records of
receipts and issuance of aloe vera during February:
Wira Sdn Bhd 生产以芦荟为主要成分的手部和身体乳液。由于缺乏备用库存，威拉私人有限公
司不得不全年采购芦荟。以下是 2 月份芦荟的收货及发放记录:

1 February Opening stock of 285 units at RM21 each unit. 开幕库存 285 个单位，
每单位 RM21。
4 February Issue 150 units.
6 February Purchase 300 units at RM22.80 per unit. 以每套令吉 22.80 的价格购买
300 套
8 February Issue 185 units.
10 February Purchase 215 units at RM25 per unit. 由于付款及时，供应商给了 20%
的折扣。
The supplier gives 20% discount due to prompt payment.
18 February Return to supplier 20 units of stock purchased on 10 February 2008. 退
回供应商在 2008 年 2 月 10 日购买的 20 件存货。
28 February Stock count shows that only 400 units are available in the store. 库存计
数显示商店里只有 400 件可用。

Required: 要求:

1. Prepare a Store Ledger Card using following methods: 使用以下方法制作商店分类卡:

a) First-In-First-Out 先进先出
b) Last-In-First-Out 方法暗含
c) Weighted Average Cost methods 方法暗含

2. Calculate the total cost of issue to production and the closing stock balance. 计算到生产的总成本和
期末库存余额。

Example 2 - FIFO, LIFO and WACM

The following information relates to the movement of stocks for the period ended 31 May:
下列资料涉及 5 月 31 日终了期间的存货流动情况:

Date Transactions
1 January Balance b/d 10,000 units @ RM4 per unit
15 January Purchased 5,000 units @ RM4.10 per unit
25 January Issued 9,000 units
15 February Issued 2,000 units
10 March Purchased 20,000 units @ RM4.20 per unit
16 April Issued 15,000 units
18 May Purchased 5,000 units @ RM4.30 per unit
20 May Return Outwards 1,000 units (purchased on 18 May)
25 May Issued 10,000 units

On 31 May, the physical stock take indicated that the balance of stock on hand was 2,800 units.

Required:

Prepare a Store Ledger Card using following methods:

a) First-In-First-Out
b) Last-In-First-Out
c) Weighted Average Cost methods

Calculate the total cost of issue and the closing stock balance.
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