Stock valuation/stores ledger record

nodgers1

Hello

i have just started unit 6 and am going ok so far, but one section i just cant seem to grasp is recording stock valuations using a store ledger card. one of my firrst assignments requires to work out closing stock valuation using FIFO< LIFO AND AVCO, but i have no idea where to start if i cant grasp how to to fill in the store ledger card. further more all my examples in my workbook ( i am using osbourne) have an opening stock figure, but in my assignment i have to work out closing stock valuation when there was no opening stock of raw material.

pls can anyone help or explain this to me in simpler terms how to fill in the columns as i cant move fwd until i have fully grasped this

thank you

sdv

search sandy hood's postings

he has done a lot of work on this topic

he also has a blog on materials/stock on the aat site.

if you can't find his work just post a help note again and i will work out an example of each for you, but I am sure this wheel has already been excellently invented by Sandy.

Try this Link

http://forums.aat.org.uk/showthread.php?t=23981&highlight=fifo

Excellent examples and explanations.

Dipak Thanki

You don't need to know how to work out LIFO, it isn't examined anymore.

Dipak

SandyHood

Dipak Thanki is quite right about LIFO as far as a numerical task

But unless the testing strategy has changed since I discussed this with Les Nightingale at a masterclass in October 2009, then LIFO can be tested as a narrative task.

So I think that working through an exercise may well help you to master principles.

See if you can understand the affect that changes in price have on stock issues and closing stock values under all three methods of valuation.

SandyHood

On the Fifo blog there is typo. Please accept my apologies.

Where it says:
the next 80 units issued will be issued at £8.90 each
it should say
the next 30 units issued will be issued at £8.90 each

Jonno1

you say you have to work out closing stock when the opening stock figure is not given?

Could this be linked to tasks to be undertaken in the chapter 'incomplete records', where for example you have to work out opening stock from closing stock either by substituting into the formula for cost of sales ie opening stock +purchases less closing stock, or by using the formula to calculate cost of goods sold based on gross profit margin or mark up ie cost of sales + gross profit = sales.
I hope this makes sense

SandyHood

Incomplete records in the way you described will only appear in the FRA paper