so the stock you receive first is what goes out first at that price....example
received 20 items at £4 cost each total = £80
goin out 10 items at £4 each total = £40 stock left is 10 items total £40
receive 20 items at £5 each so total stock is 30 items total £140
goin out 5 items so the ones to go out are 5 £4 ones leavin total of 5 at £4 each and the 20 at £5 each = £120
goin out 15 items so the 5 at £4 each go first and then 10 of the £5 ones total left is 10 at £5 each = £50
same principle for LIFO but Last In First Out so you use the last ones in to go out first....
Avco is the average so if you buy 10 at £5 total £50 then if you buy more of the same say....10 at £10 each you r total is the average £150 / 20 = £7.5 each so those goin out are £7.50 and you find the avco every time you buy more items..
Comments
First In First Out
so the stock you receive first is what goes out first at that price....example
received 20 items at £4 cost each total = £80
goin out 10 items at £4 each total = £40 stock left is 10 items total £40
receive 20 items at £5 each so total stock is 30 items total £140
goin out 5 items so the ones to go out are 5 £4 ones leavin total of 5 at £4 each and the 20 at £5 each = £120
goin out 15 items so the 5 at £4 each go first and then 10 of the £5 ones total left is 10 at £5 each = £50
same principle for LIFO but Last In First Out so you use the last ones in to go out first....
Avco is the average so if you buy 10 at £5 total £50 then if you buy more of the same say....10 at £10 each you r total is the average £150 / 20 = £7.5 each so those goin out are £7.50 and you find the avco every time you buy more items..
hope this helps
:thumbup1: