You have been provided with the following information for the month of March 2024. The inventory system used by the company is FIFO (First-In, First-Out). Proceed to complete the stock card accordingly afterward answer the questions that follow:

01 Mar

 Opening stock 400 units valued at R12,000 in total

05 Mar

 Purchased 70 units at R35 per unit

10 Mar

 Issued 120 units

12 Mar

 Returned 30 units to the supplier (from the 05 Mar purchase)

20 Mar

 Issued 90 units

22 Mar

 Items returned to the storeroom 15 units

28 Mar

 Issued 45 units

30 Mar

 Purchased 150 units at R40 per unit

31 Mar

 Stocktake ???

What is the total value of finished goods remaining at the end of March?                              3 MARKS


Answer:Question 1


To determine the total value of finished goods at the end of March 2024 using the FIFO (First-In, First-Out) method, we will update the stock card with the given transactions.

### Stock Card for March 2024 (FIFO Method)

#### 1 March: Opening stock
- **Quantity:** 400 units
- **Total value:** R12,000
- **Cost per unit:** R12,000 ÷ 400 = R30/unit

#### 5 March: Purchase 70 units at R35/unit
- **Quantity:** 70 units
- **Cost per unit:** R35/unit
- **Total value:** 70 × 35 = R2,450

#### 10 March: Issue 120 units
- Since we use FIFO, we issue from the oldest stock (R30/unit).
- 120 units at R30/unit = R3,600

#### Stock remaining after 10 March:
- 280 units from the opening stock at R30/unit
- 70 units from the purchase on 5 March at R35/unit

#### 12 March: Return 30 units to supplier (from 5 March purchase)
- 30 units returned at R35/unit = R1,050
- Remaining stock from 5 March purchase: 70 - 30 = 40 units at R35/unit

#### 20 March: Issue 90 units
- Issue 90 units at R30/unit (from the opening stock).
- 90 × R30 = R2,700

#### Stock remaining after 20 March:
- 190 units from the opening stock at R30/unit
- 40 units from the 5 March purchase at R35/unit

#### 22 March: Return 15 units to the storeroom
- These are returned units and will be added back to the stock. The cost of these units is assumed to be the same as the last issue (R30/unit).
- 15 units at R30/unit = R450

#### Stock after 22 March:
- 205 units from the opening stock at R30/unit
- 40 units from the 5 March purchase at R35/unit

#### 28 March: Issue 45 units
- 45 units issued at R30/unit (from the opening stock).
- 45 × R30 = R1,350

#### Stock remaining after 28 March:
- 160 units from the opening stock at R30/unit
- 40 units from the 5 March purchase at R35/unit

#### 30 March: Purchase 150 units at R40/unit
- 150 units at R40/unit = R6,000

#### Stock remaining before stocktake on 31 March:
- 160 units from the opening stock at R30/unit
- 40 units from the 5 March purchase at R35/unit
- 150 units from the 30 March purchase at R40/unit

### Total Stock at 31 March
- 160 units at R30/unit = R4,800
- 40 units at R35/unit = R1,400
- 150 units at R40/unit = R6,000

### Total value of stock at 31 March:
- **R4,800 + R1,400 + R6,000 = R12,200**

### Answer:
The total value of finished goods remaining at the end of March is **R12,200**.

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Do you want more details or have any questions?

Here are 5 related questions to expand on the topic:
1. What would the stock value be if the company used the LIFO method instead of FIFO?
2. How does the FIFO method affect the cost of goods sold in times of rising prices?
3. If there were a stock loss during the stocktake, how would it be recorded?
4. What are the advantages of using FIFO in inventory management?
5. How would the return of damaged goods from a customer affect the stock card?

**Tip:** Always ensure that the stock card entries reflect real-time updates to prevent discrepancies during stocktakes.

You have been provided with the following information for the month of March 2024. The inventory system used by the company is FIFO (First-In, First-Out). Proceed to complete the stock card accordingly afterward answer the questions that follow: ... What is the total value of finished goods remaining at the end of March?

Learn how to calculate the total value of finished goods at the end of March 2024 using the FIFO (First-In, First-Out) method. This problem involves key inventory management concepts, including cost calculation and stock card updates. Suitable for students in Grades 11-12 and college-level accounting or finance courses.

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