# [Q costs and Revenues] for some reason can not work out this AVCO question :S

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Registered Posts: 452
Hi,

Trying to do part B the correct answer is £61,333.33 but i keep getting £73905.88235 looked at it for 30 minutes now it is driving me mad :cursing:

These are my workings:

104,700/34,000 = £3.079411765 per unit

Issues 10,000kg

therefore £3.079411765 per unit * 10,000 = £30794.11765

£104700 - £30794.11765 = £73,905.88235

which leaves me with me the remaining balance of 24,000kg at a total cost of £73,905.88235

can not get £61.333.33 correct answer what am i doing wrong please?

Fresh pair of eyes is very needed and appreciated

Thank you !

• Registered Posts: 782
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Hi,

Look at the date in the question! It's asking for the value after the first issue, not at the end. (I admit I just did the same!)

After the 3 dec receipt we have 30,000 kg at a total cost of £92,000.

The 14 Dec issue of 10000kg is charged at £30666.667 (92000/30000 * 10000), leaving you with £61333.333 worth of inventory (92000-30666.667 or alternatively 92000/30000 * 20000)
• Registered Posts: 452
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Nps1976 wrote: »
Hi,

Look at the date in the question! It's asking for the value after the first issue, not at the end. (I admit I just did the same!)

After the 3 dec receipt we have 30,000 kg at a total cost of £92,000.

The 14 Dec issue of 10000kg is charged at £30666.667 (92000/30000 * 10000), leaving you with £61333.333 worth of inventory (92000-30666.667 or alternatively 92000/30000 * 20000)

Thank you ! the question is worded very confusingly (in my mind anyway)

i can stop being frustrated with this one now :001_smile:
• Registered Posts: 782
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No, they're just making sure you read the question. I'll be the first to admit, I skim read it and missed the date first time - my own fault and exactly what they were testing.
• Registered Posts: 452
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Think what is confusing me is the "inventory remaining after the issue of inventory on 14th December" this to me would mean after the issue of 10,000kg total cost £30,000 on the 14th

think i am going to have to come back and read this again tomorrow see if the mud clears then , my brain is getting frazzled
• Registered Posts: 782
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It does mean that, but you've had an extra delivery of stock so the total cost is no longer £30,000. If you were using the FIFO method then the 10,000 issued would be the £30,000 stock, but you're using AVCO in this part of the question so the issued goods are a mixture of the delivery and the opening balance.

Go have some lunch and I bet it all clicks afterwards.
• Registered Posts: 452
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i dont know what was in those sandwiches but everything is clear now , from this i have learn t i need to eat more sandwiches !
• Registered Posts: 782
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I find copious amounts of chocolate works well too!
• Registered Posts: 283
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Guinness!!!!!
• Registered Posts: 2,525 Beyond epic contributor 🧙‍♂️
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a good nights sleep! :001_tongue:
~ An investment in knowledge always pays the best interest ~
Benjamin Franklin
• Registered Posts: 452
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Just waiting for the person to come out with a pint of straight vodka