NUMERICAL QuesTIONS ions mumerical QuestiOM® acy qothod mi om W the cost of closing stock BY babe 7 aa n Rages Materials Purchas ake Pate gat Unis : Mar. 16 50 a 19 is - ss sorts 200 Fy Mar. 22,2501 u hoa Le ae ihe ealunel k by LIFO Method tases 2 Calculate the value of closing Sto ‘expected on this date. Issued on Requisition Issued on Requisition ) Received from supplier by expected on this date. Issued on Requisition No. 428: 69 ton Issued on Requisition No. 447. 29 ton. Received from supplier by Challan No. 171 of August 30, 2021 - 125 ton. The supply was expected on this date. Received back by credit slip No. 37° 10 ton. Issued on Requisition No. 483: 85 ton. by Stock Verifier on August 25, 2021, revealed a shortage of § ton. The maximum 74 of August 5, 2021 | 120 ton. The supply was fo. 364. 30 ton. Chalian No. 98 of August 17, 2021 . 100 ton. The supply was Examination by arount of stock of coal permissible at any time is 200 ton, and the minimum 50 ton. The ordering level is 100 Draw up the Bin-Card August 2021 ‘Ane. Balance on 31st August : 105 ton. taining two important materials X and ¥ and the invoice z 3, Afactory has received one consignment cont pertaining to Materials X 2.000 Ton @ 8. 1 per ton Materials ¥ 2,400 Ton @ 80 Paise per ton Insurance Freight, ete GST ton, (No. 23) for coal with all the necessary details showing the transactions in the same discloses the following information aloes of 40 ton of material X and 24 ton of material Y was Due to mishandling in the factory's store, issuing these materials to the jobs? Ifa provision of 20% 1s recorded. What rate would you adopt for risk of obsolescence, what would be the new rate? to be made for probable ‘Ans. Material X % 1.22 & Material Y 0.98; New rate 1.46 and & 1.16 respectively 4. From the following particulars, prepare material issue prices on the ‘First in, First out’ Method: Date 2021 Jan. Ans, Issue—Jan. 2 : % 8.50; Jan. 11: 200 @? 8. Jan. 28: 200 @ z 6 and 100 @z 5.50. CI Pricing of Materials issued FIFO Method stores ledger for the month of January 2021 showing Receipt Issue Qty. Rate Date Qty. (kg) z 2021 (kg) 1 300 8.50 Jan. 2 100 10 400 8.00 un 500 15 500 6.00 18 400 28 400 5.50 23 300 50 and 300 @ 8; Jan. 18: 100 @ 7 8 and 300 @% 6; losing Stock 300 valued at % 1,650.p of the issue should e#© ity used in the raring the six months ‘ 00 Cost Price per} 10.00 10.50 5 % 9.50 a 9.00 x aa 3 12,000 8.50 i \ mam 5 3,000 ve valued at & 9.50 per 100 units. Ot aon iin stock at Apeil 1.2021 which wernt Ta oan ee are during te x mombe wee AENPNT ay teued 10,000 2021 (a. B 8,000 ) B 25,000 (dune 20,000 id) July 0 18,000 See 2 15,000 ‘At what price should the issue be charged and the closing stock valued? Prepare a Stock Ledger Account, illustrating views. ‘Aas. lneve price: (a) 950,16 775; (c) 2,590; (d) 1,970; (e) % 1,655; ( f 1,350; according to FIFO Method. Closing Stack Price of 29th Sep. : & 90. 7 oy illowing are the particular ofthe receipts and issues of materials in a factory during March, 7 Qpesing beanen seo et Per ke i 13 ‘Received vendor March 14 Reta of epee tena wack 200 kg @ & 24.50 per kg [16 tesued nde, 15 kg @ 24.00 per kg 5 2 Received fom vendor wove * . Tasued % 24.37 . = Received from vendor me peeks ° Tovoed ke@z 24.31 a Return of surplus from a work order 12 kg Per kg - Received form vendor 12 kg @% 24.50 ber kg 190 ke @ & 25.00 per keg 50 kg Return to vendor The store verifer noted thai Another shortage of Sky Write 15th March there was a i Out the Shortage of Att FIFO Method. Shortage Beiter Accantin pense 27 March the considered as normal logy t* Above materiala 8 Prepare Store Ledger Account following informations Da! oie I te Rate 2021 z _— Units Jan. 1 1,000 ao 1 a \ jin is 300 = Jan. 4 7 Jan. 24 600 40 pay ane ly Jan. 18 500 x! The Store verification report reveals that on 12th Jan. refund sf40 shits @ & 38 from’ customer. On 13th Jan. 10 units are destroy and ue another shortage of 8 uni a [Ans. Issue Price : 16,000, 16,271, 19,819, 16,428 C/S raiesasoat Jan. 31 ¥ 24; (int. : Shortage should be considered as abnormal loss] 2! 9. The Stores ledger of a manufacturing company recorded for material item ‘R' for January, 2021 provides the following informations : T 300 2 | Jan. 5 500 | 2 | 1,000 300 | S00 | | 500 2 ,000 Jan.10 | 500 4 | 2,000 3,00 2 | rs) |_| _ |B8lil| & | 4 x Jan. 15 - | - - 200 > | 00 | 500 4 2,000 Jan.20 50 — — 200 4 800 Jan.22 | 600 | 3,000 200 4 800 | 600 | 3,000 Jan.24 | — _ 200 5 1000 7. State the method of pricing that was employed in the ledger 2. Complete the stores Ledger as per the method followed. Ans. Issue price : 1,200, 1,600, 2,800, 500; C/S on Jan. 31, 8 500 LIFO Method 10. Find out the issue prices of the material on ‘Last in, First out’ method from the following particulars: Receipt Issue Date Qe. Rate Date Qty. 2021 (kg) zt 2021 (kg) Feb. 10 200 12.00 Feb. 3 300 15 300 14.00 12 100 z 3 _ 2 16.00 = rel 26 400 On Ist Feb., 2021 the opening stock was 400 kg valued at t 11 per kg. Ans. neces Feb. 3G TeFeb, 12 @ ¢ 12; Feb 14: 100@ T 12 and 100@ € 11; Feb. 18:@ 8 14; Feb. 26 :@ 15. Closing stock: 100@& 14 and 100@ ¥ 16, ! p. The following trananctiona in reepect of material Aoecurred during the six months ended December 31, 2021 : . lines ; Date Purchases (kg) Price per be ae ~ > 4.75 445 480 5.25 = 440 4.60 2 520 5.00 $ 400 4.50card under TIF is rede nee “on fallome ¢ 5.00 ee Sct ifort t 2 5 Ke: 6 e i Feb. 20 2021 0 3 | Feb 1600 8 | jared vendor om ee a 16m pierre 00d ting of material 185 were fo Fob due to short a as . der mo on checking “ iene gerne tome te te OO ee para ser 1250 kg @ #20 per kt the 13 Fon da vi) LIFO Mé 50 kg @ @ 18 per kg he 200 kg @ 7 22 per ke =, 700 kg Jamusary 7 soo ng @t 22+ 200kg G2 1B =T 34/600; owing the issue of material oy Issues danwary 25 = 14,000, (ii) LIFO = aw 700 kg @2 20 = € 14,000 yunt shi Ans t) FIFO Ho aon prepare Stores Ledger APSO LIPO pethod ance 500 units @ & 1 per unit. 10 Ordered 250 units. 18 Issued 125 units. 31 Received 150 units @ ¢ 1.10 each. 25 Ordered 200 units November 1 Issued 176 units. 10. Received 200 units @ 1.20 each. F units defective, returned; they were purchased on Oct. 21. December 1 Received 100 units @ 1.10 each. Issued 100 units. Returned to store 25 units, issued snug ili ni on Dec. 15. Closing stock at the end of 30th December: ? 465.00 as follows: ‘HS units @2 1; 100 ae a units @% 1.20. spetnn| rurtased e made before being stored So5 units defective have been kept separate os Ni Thus, on Nov. MS unite ae to be issued @ 1.10 and 5 units returned on Nov 20 have been priced € ‘MATERIAL, COST ACCOUNTING a eras the following informations Prepare stores ledger account on the basis of ‘Highest-in First-out’ From 16 (IFO) method Material Recived Material Issued 1Jan. 200kg@z 10 6 Jan 00 15Jan. 400 kg @t 30 18 Jan. S00 te 25 Jan. 100 kg @z 20 28 Jan. a ‘Ans. Material Issued : % 900, % 6,000, % 9,100, Base Stock Price Method 17. From the following particulars write up Store Ledger Account . 2021 Jan 1 Purchased 50 units @ Tan 8 Purchased 30 units era be den 4 feeued 60 units. jan rehased ‘ 3 Jan 24 Issued Sounite ~~ jan rad Bo unite @z 21 pu. Jan 31 |, dss Use the ‘Base Stock Method’ of issue. Base stock is 20 unite. Ans. Jan 14 Issue Price € 1,230; Jan 24 Issue Price t 660, Jan 31 Issue Price 430; Closing Stock 20x 20 + 40x 21 = 21.240 Average Method 18. The following transactions took place in respect of a material item : Ree wip Quantity Rae Issue ‘Quatitty 300 2.40 a — — 250 250 2.60 = ==) 200 20.3.2021 — Prepare Stores Ledger Account applying ; (a) Simple Average Method, (b) Weighted Average method. Ans. (a) Issue 250 units % 550 and 200 units % 500; (b) Issue 250 units t 560 and 200 units % 484. 19, Set up a ‘Stores Ledger’ form and enter the following transactions adopting the ‘weighted average’ method of pricing out issues: 2021 August, 1 Opening balance 50 units @ ¢ 3 per unit. 5. Issued to production: 2 units. 7 Purchased 48 units @ & 4 per unit. 9 Issued out 20 units to production. 19 Purchased 76 units @ % 3 per unit. 24 Received back into stores 19 units out of 20 units issved on 9th Aug.. 2021 27 Issued to production 10 units. Ans. Issue amount: Aug. 5 % 6.00; Aug. 9 % 70.00; Aug. 27 % 32.78. From the following details of stores receipts and issues of material of manufacturing unit, prepare the Stock Ledger using ‘Weighted Average’ method of valuing the issues : Nov. 1 Opening stock 2,000 units @ % 5.00 each Nov. 3 Issued 1,500 units to Production Nov. 4 Received 4,500 units @% 6.00 each Nov. 8 Issued 1,600 units to Production Nov. 9 Returned to stores 100 units by Production Department (from the issues of Nov. 3) Nov. 16 Received 2,400 units @ 6.50 each Nov. 19 Returned to supplier 200 units out of the quantity received on Nov. 4 Nov. 20 Received 1,000 units @ % 7.00 each Nov. 24 Issued to Production 2,100 units Nov. 27 Received 1,200 units @ % 7.50 each Nov. 29 Issued to Production 2,800 units (Use rates upto two decimal places). Ans. Value of Closing Stock % 19,558.arJanuary: 2021 ending 3! period * er2pr sgt Sratne 00 units gnounis @F00PS 200 units 200 units lows stock * 225 20 at dan as foll 25 Closiné nding. ‘Jan 31 ¢ 650. the pesod © for 031 cus dates en vane yan SES 20 ¢ 550, Jan ft — 100 6 per kg. Es ei i per kg. aI wae 100 kg. @ 2 4 per ke: Replacement cost pe ag sock on Tat Mach, 20 | | culars poe oS on 31st March ® ‘standard Price Method for the first quarter of the | jons for the sand the following are the transactions ‘Stocks are issued at standard price | year: | r 1,000 kg @ 7 9.00 per kg: Opening Stock 5,000 kg @ 8.50 per kg | Issued on 3.780 kg | Issued Issucd 650kg Purchased 2,500 kg @ € 8.00 per kg The profit balance of price variance account before transfer to Costing P. & L. A/e was % 500. Prepare ‘Stores Ledger Account after finding out Standard Rate of issue, and show the price variance. ‘Ans. Closing Stock at Standard Price of t 8.50 per kg = & 29,750; Closing Stock at Actuals t 29,000; Price Variance % 750 (favourable). ‘ Hints : In the previous year Standard Price was % 9.00 per kg. So the value of closing stock of that year was? 9x 1,000 =? 9,000. As there is profit balance of price variance, the standard price should be less for this year. 79,000 — So, Standard price = on 50) e850 perky 24. Stocks are issued i i are x ania pric and the following transactions occured for a specific period : duly t Stock 10 uni : dt units @ % 240 per unit Bi : S units @ 260 per unit duly 12 3 2 Purchases $ units @ & 250 per unit ire Rtg jim sib 28 Purchases $j unite @ € 280 per unit ‘The debit i i materi: os mart Pe Vrain on 1st July was ¢ 99 Show th Accou: : 20. 1 Stock remtegi wait You Would deal with the difference in cn : ae material price variance.27. Record the following transactions MATERIAL COST ACCOUNTING Po Hints: Standard price will be calculated a follow, Value of Opening Stock 10 q (Sah ICE uni Be Total Value Standard Price por Closing stock is 5 units, ) Standard Price of 5 units @ @ 24y . ‘petal Price of nts @ e 242 e 1210 Price Variance (Dr. or Adverse) zg Us Inllated Price Method From the following particulars, Prepare Store ledger account of K material by using FIFO method ee Issues oat Ory. (ke. Rate (®) Date Qty. (ke. Jan 1 400 4 dan 12 200 gas 3 ae, 5 Jan 20 250 = 3 Jan 31 350 Wastage of material has been estimated 20% Ans. Issue : Jan 12 1,000, Jan 20% 1,412.50, Jan 31 2 1,387.50. Use of Different Methods jod : POctaber 1 Balance 500 units @ ¢ 1 per unit. 10 Ordered 250 units by Purchase Order No. 91 and goods expected on 20th Oct. 38 Issued 125 units Req. No. 340 to Dept. X. 21 Received 150 units PO. No, 91@? 1.10 each. 25 Ordered 250 units P.O. No. 115 expected on 5th Nov, Nov, 1 Issued 175 units Req. No. 350 to Dept. Y. 10 Received 200 units P.O. No. 115 @ 1.20 each, 20 It was discovered that 5 units received on Oct. 21 P.O. No. 91 were defective and $0 were returned to vendor. December 1 Received 100 units being the balance of P.O. No. 91 @ @ 1.10 each. 15 Issued 100 units Req. No. 370 to Dept. Z. 20 Dept. Z returned to Store Room 25 units, earlier issued on 15th December. Tnsued 125 units Req. No, 380 to Dept. X. 30 Ans. Closing Stock valued at: Qty. Rate Amount z z LIFO 345 1.00 —— is 12, iia Wei 445 1 5. Pricing the materials issued according to (i) FIFO and (ii) LIFO, Show the balance after transaction and the inventory value on 30th September, 2021 : July 1 Balance 1,000 units @ % 1 per unit. July 15 Ordered 500 units, purchase order Nov. 701. Expected July 20 Issued 250 units, M.R. No. 251 to Department X. July 21 Received 300 units, Purchase Order No. 701 @ 1.10 per unit. Ordered 500 units, Purchase Order Nov. 725. Expected August 5, Issued 350 units, M.R. No. 260 to Department Y. Aug. 1 , (0 Received 400 units, Purchase Order No. 725, @ 2 1.20 per unit. ia red July 21, Purchase Order No. 701, were Aug. 20° Itw discovered that 10 units received on * defective. They were returned to the vendors, : Sept. 1 Received 200 units, the balance of Purchase Order No. 701,@¥ 1.10 per unit, Sept. 15 Issued 200 units, M.R. No. 275, to Depatment Z,sia eo cost ACCOUNTING . ee a a it, 50 units which were jssued on Sept. 15 to stock room credi 12 wie room for EX. yt. 20 yen! wnt X- Sept. 30 ened 250 units MR. N 285 t0 Teo method : ‘Stock in hand Ran 1. FIFO method : Stock 1? ; io ‘290 units @ 1.10 units @ 1.00 | . 928.00 400 units @ 1.20 = 1,019.00 190 units @ 1.20 200 units @ 1.10 terial X ‘The following information is extracted from the stores ledger of Ma Opening St Nil 5 dant Purchases 100 units @ € 1 per unit Jan. 20 Purchases 100 units @ & 2 per unit Jan. 22 Issues 60 units for Job No. 16 Jan. 23 Issues 60 units for Job No. 17 ao. . Complete the receipts and issues valuation by adopting the First-in-first-out, Last-in-first-out and the Weighted Average Method. ‘Tabulate the values allocated to “job No. 16 and Job No. 17 and the Closing Stock under the methods aforesaid. Ans. Particulars FIFO (2) LIFO®) Weighted Ai Job No. 16 60 120 ighted Average (2) 90 Job No. 17 80 100 a io i 120 300 300 Closing Stock 300