1/5/07 Purchased 100 bags of milk at #10.00k each

3/5/07 Purchased 60 bags of milk at #11.50k each

15/5/07 Issued 85 bags of milk

15/5/07 Purchased 180 bags of milk at #12.80K each

22/5/07 Issued 145 bags of milk.

Using simple average method, calculate the value of stock after 22/5/07

  • A #1,198.00
  • B #1,218.38
  • C #1,257.67
  • D #1,408.00
jamb 2012accounting

The correct answer is C. #1,257.67

date quantity unit cost Dispatch quantity Balance
1 100 10.00   100
3 60 11.50   60
15     85 75
15 180 12.80   255
22     145 110
  340 34.3 230 110
(34.3 / 3) x 110 = 1257.67 The value of stock is gotten by dividing the total unit cost by the number of times stock was purchased and multiplying it by the balance of stock at the end of the month or period. Previous question Next question