Question

3. The following information is provided by a dealer in computer chips. The dealer follows FIFO method for valuing stock, calculate from the following figures –

Date particulars April 1, 2019 Opening stock 750 chips @Rs1550 per chip Purchases April 10, 2019 1000 chips @Rs1750 per chip April 20, 2019 1650 chips @ Rs1875 per chip Sales April 15, 2019 900 chips @Rs3000 per chip April 16, 2019 1950 chips @ Rs 3250 per chip

a) Cost of goods available for sale 300 Words

b) Gross profit 300 Words

Answer 1

a) Cost of Goods Available for Sale :

                              = Opening Stock + Purchases - Closing Stock]

Opening Stock = 750*$1550 = $11,62,500

Purchases = 1000$1750 + 1650*$1875 = $48,43,750

Closing Stock = Total Stock available - Sale of stock

The dealer follows FIFO method so,

Sale of 2850 chips (900+1950) is from as follows

Aprl 15 : 750 + 150 = 900

Aprl 16 : It is possible only to sell 850 units. The question is wrong

Closing Stock : April 20 - : 550*1875 = $10,31,250

                       April

b) Gross Profit : = Sales - Cost of Goods Sold

Sales = 1950*$3250 = $63,37,500

Cost of Goods Sold = can't find in this question due to on April 16 we are having only 850 units , it is impossible to sell 1950 chips.