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Exercise on Inventory Valuation

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Yati Shaiful
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5 views

Exercise on Inventory Valuation

Uploaded by

Yati Shaiful
Copyright
© © All Rights Reserved
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Exercise on Inventory Valuation

QUESTION 1

Aleeya is the owner of Chicky Chicky Trading. The following information are the
data of inventories.

Date Purchase Sales


December 2 10 units @ RM 3 each
6 5 units @ RM 10 each
10 10 units @ RM 2 each 2 units @ RM 17 each
11 10 units @ RM 4 each
14 15 units @ RM 19 each
19 18 units @ RM 3 each
20 15 units @ RM 5 each
22 19 units @ RM18 each

Compute the cost of goods sold and closing inventory using the perpetual
system with First-In-First-Out (FIFO)

FIFO
Date Details Purchases / In Sales / Out Balance
Dec Quantity Cost Value Quantity Cost Value Quantity Cost Value
Price Price Price

QUESTION 2
Katrina is the owner of Unique Boutique at Kota Tinggi. The following information
are the data of inventories bought by Katrina in November 2023. Inventory
balance on 1st November 2023 is 10 units @ RM3.50 each.

Date Purchase Sales


November 12 units @ RM 3.40 each
2
6 10 units @ RM 6.00
each
10 10 units @ RM 2.50 each 2 units @ RM 7.00 each
11 8 units @ RM 4.45 each
14 19 units @ RM 9.50
each
19 18 units @ RM 3.90 each
20 5 units @ RM 5.60 each
22 9 units @ RM 8.00
each

Compute the cost of goods sold and closing inventory using the perpetual
system with First-In-First-Out (FIFO) and Last- In- First-Out (LIFO) methods.

FIFO
Date Details Purchases / In Sales / Out Balance
Nov Quantity Cost Value Quantity Cost Value Quantity Cost Value
Price Price Price

LIFO
Date Details Purchases / In Sales / Out Balance
Nov Quantity Cost Value Quantity Cost Value Quantity Cost Value
Price Price Price

QUESTION 3

SmartShop carried out its year end stock count for financial accounting
year ended 30 December 2023 and recorded 6,000 units of Model AA007,
which costs RM30 per unit. The following transactions were recorded in
2024.

Date Transaction Units Cost / Unit (RM) Retail Price / Unit (RM)
Jan 20 Purchase 5,000 34
Feb 3 Sales 4,500 80
Mar 8 Purchase 6,000 35
Apr 16 Sales 3,500 82
May 1 Sales 2,200 82
June Sales 2.500 84
10
July 25 Purchase 4,000 36
Aug 16 Sales 5,500 86
Sept Purchase 5,500 38
11
Nov 15 Sales 2,800 88
Dec 24 Sales 4,900 90

Currently, the company is adopting the Weighted Average (WA) method,


Perpetual Basis to manage its inventory.

Compute the cost of goods sold and closing inventory.

Question 4
Dagang Perantau is a retail business that sells electronic gadgets. The company
uses the FIFO (First-In, First-Out) method for inventory valuation.

The following information is available for the month of April 2024:

1. Beginning inventory on April 1: 100 units at RM50 per unit

2. Purchases during April:


- April 5: 200 units at RM55 per unit
- April 15: 150 units at RM60 per unit
- April 25: 120 units at RM65 per unit

3. Sales during April:


- April 10: 250 units at RM100 per unit
- April 20: 180 units at RM110 per unit
- April 30: 200 units at RM120 per unit

As a store manager of Dagang Perantau Trading, you are requested by your


account manager to prepare the following records of the inventory in a stock
card.

Calculate the following for the month of April using the FIFO method:
a) Cost of goods sold (COGS)
b) Ending inventory value
c) Gross profit

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