STORES LEDGER:

1. The following details are supplied by XYZ Ltd. in respect of its raw
materials for the month of December, 2020:

Date Receipts Issues

Units (Kg.) Price per unit (Rs.) Units (Kg.)
1.12.2020 2,000 5.00
7.12.2020 1,000 6.00
10.12.2020 2,500
15.12.2020 2,000 6.50
31.12.2020 2,200
On 31.12.2020, a shortage of 100 units was found. Find out the values of
closing stock on different methods using:

(a) FIFO (b) LIFO (c) Simple Average Method

Solution:

STORES LEDGER (FIFO)

Date Receipts Issues Balance Rema
rks
GR QNT RT. Rs. SR QNTY. RT. Rs. QNTY. RT. Rs.
N. Y. N.
1.12.20 2000 5 10,000 2000 5 10,000
7.12.20 1000 6 6000 3000 16,000
[2000 5
1000 6
10.12.20 2,500 13K 500 6 3000
[2000 5
500] 6
15.12.20 2000 6.5 13000 2500 16000
[500 6
2000] 6.5
31.12.20 2200 14,0 300 6.5 1950
[500 6 50
1700 6.5
31.12.20 100 6.5 650 200 6.5 1300
 STORES LEDGER (LIFO)
Date Receipts Issues Balance Rema
rks
GRN. QNTY. RT. Rs. SR QNT RT. Rs. QNTY. R Rs.
N. Y. T.
1.12.20 2000 5 10,000 2000 5 10,000
7.12.20 1000 6 6,000 3000 16,000
[2000 5
1000 6
10.12 2500 13500 500 5 2,500
[1000 6
1500 5
15.12 2000 6.5 13000 2500 15,500
[500 5
2000 6.
5
31.12 2200 14000 300 5 1,500
[2000 6.5
200 5
31.12 100 5 500 200 5 1,000

STORES LEDGER (SIMPLE AVERAGE METHOD assuming FIFO)

Date Receipts Issues Balance Rema
rks
GRN. QNTY. RT. Rs. SRN QNTY RT. Rs. QNTY. RT Rs.
. . .
1.12.20 2000 5 10,000 2000 5 10,000
7.12.20 1000 6 6,000 3000
[2000 5 16,000
1000 6
10.12 2500 5.5 13750 500 6 2250
15.12 2000 6.50 13,000 2500
[500 6 15250
2000 6.
50
31.12 2200 6.25 13,750 300 6. 1500
50
31.12 100 6.5 650 200 850
Notes:
1. Rate of Stock issued on 10.12. 2019 = (6.00+5.00)/2 = ₹ 5.50
2. Rate of Stock Issued on 31.12.2019= (6.00 + 6.50)/2 = ₹ 6.25
3. Rate applied for shortage: since the remaining lot of Materials received on 7.12.2019
has been issued on 31.12.2019.
Valuation of Shortage has been @ ₹ 6.50, i.e., at cost of the latest arrival.

2.The following details are supplied by Maclin Corporation in respect of

itsraw materials for the month of November, 2020:

Date Receipts Issues

Units (Kg.) Amount (Rs.) Units (Kg.)
1.11.2020 1000 (opening) 6,000
10.11.2020 500 3,500
15.11.2020 1,200
20.11.2020 1,000 8,000 -
30.11.2020 1,100
On 30th November, 2020, a shortage of 50 units was found. Find the values
of issues and closing stock on different methods using:

(a) LIFO (b) Simple Average (c) Weighted Average

Solution:

STORES LEDGER (LIFO)

Date Receipts Issues Balance Rema
rks
GRN. QNTY. RT. Rs. SR QNT RT. Rs. QNTY. R Rs.
N. Y. T.
1.11.20 1000 6 6,000
10.11.20 500 7 3,500 1500 9,500
[1000 6
500 7
15.11.20 1200 7700 300 6 1800
[500
700
20.11.20 1000 8 8000 1300 9800
[300 6
1000 8
30.11. 1100 8,600 200 6 1200
20 [1000 8
100 6
30.11. 50 6 300 150 6 900
20
 STORES LEDGER (Simple Average Method)
Date Receipts Issues Balance Rema
rks
GRN. QNTY. RT. Rs. SR QNT RT. Rs. QNTY. R Rs.
N. Y. T.
1.11.20 1000 6 6,000
10.11.20 500 7 3,500 1500 9,500
[1000 6
500 7
15.11.20 1200 6.5 7800 300 7 1700
20.11.20 1000 8 8000 1300 9700
30.11.20 1100 7.5 8250 200 8 1450
30.11.20 50 8 400 150 8 1050

STORES LEDGER (Weighted Average Method)

Date Receipts Issues Balance Rema
rks
GRN. QNTY. RT. Rs. SR QNT RT. Rs. QNTY. R Rs.
N. Y. T.
1.11.20 1000 6 6000
10.11.20 500 7 3500 1500 9500
15.11.20 1200 6.33 7596 300 1904
20.11.20 1000 8 8000 1300 9904
30.11.20 1100 7.62 8382 200 1522
30.11.20 50 7.61 381 150 1141
3. With the help of the following information, prepare the Stores Ledger Card based on the
weighted average method of pricing issues:
2022
Sept. 1 Opening Balance 24,000 kg. @ ₹ 7,500 per tone
1 Purchase 44,000 kg. @ ₹ 7,600 per tonne.
1 Issue 10,000 kg.
5 Issue 16,000 kg
12 Issue 24,000 kg
13 Purchase 10,000 kg @ 7,800 per tonne
18 Issue 24,000 kg
22 Purchase 50,000 kg. @ 8,00 per tonne
28 Issue 30,000 kg.
30 Issue 22,000 kg

Solution:
As per the problem, the price of material has been given in tonne but quantity purchased is in kg.
Therefore, cost per kg is to be calculated first. The procedure is

Average Price per kg. = (Cost per tonne)/ 1,000 kg. For, Example: opening Stock rate per kg. = ₹ 7,500 /
1,000 kg. = ₹ 7.50.

Stores Ledger Card

[Weighted Average]

Received Issues Balance Remark

s
Date
GR Quantity Rate Amount GR Quantity Rate Amount Quantity Rate Amount
No. No.
2022
Sept. 1 24,000 7.50 1,80,000 Op
1 44,000 7.60 3,34,400 68,000 7.56 5,14,400 Stock
1 10,000 7.56 75,647 58,000 7.56 4,38,753
5 16,000 7.56 1,21,035 42,000 7.56 3,17,718
12 24,000 7.56 1,81,553 18,000 7.56 1,36,165
13 10,000 7.8 78,000 28,000 7.65 2,14,165
18 24,000 7.65 1,83,570 4,000 7.65 30,595
22 50,000 8 4,00,000 54,000 7.97 4,30,595
28 30,000 7.97 2,39,219 24,000 7.97 1,91,376
30 22,000 7.97 1,75,428 2,000 7.97 15,948 cl.
Stock
Working Notes:

(1) Weighted average rate for September 1 issue:

Opening stock 24,000 kg and value ₹1,80,000
Add: Purchases 44,000 kg and value ₹3,34,400
________________________________________
68,000 ₹ 5,14,400
Cost per kg. =(₹ 5,14,400)/(68,000 kg.)=₹75,6470.
Value of Issue = 10,000 kg. x ₹ 7.56470 = ₹ 75,647.

(2) Weighted average rate after purchases of 13th September:

Stock in hand 18,000 kg and value ₹ 1,36,165
Add: Purchases 10,000 kg and value ₹ 78,000
28,000 2,14,165
Average Price Per Kg. = (₹ 2,14,165)/ 28,000 kg. = ₹ 7.64875.

(3) Value of Issue of 18th September:

24,000 kg. x ₹ 7.64875 = ₹ 1,83,570

(4) Weighted Average rate after purchase of 22nd September:

Stock in hand 4,000 kg, and value ₹ 30,595
Add: Purchase 50,000 kg. and Value ₹ 4,00,000
54,000 4,30,595

Average Price per Kg. = (₹ 4,30,595) / (54,000 kg.) = ₹ 7.97398.