JAMB Accounting 2012 Objective — Question 20

Question 20 of 50 from the Joint Admissions and Matriculation Board (JAMB) Accounting 2012 Objective paper, with the correct answer and a full explanation.

Use the information below to answer questions 20 and 21. 1/5/07 Purchased 100 bags of milk at ₦10.00c each 3/5/07 Purchased 60 bags of milk at ₦11.50c each 8/5/07 Issued 85 bags of milk 15/5/07 Purchased 180 bags of milk at ₦12.80c each 22/5/07 Issued 145 bags of milk Using FIFO method, what would be the value of stock as at 9/5/07?

A. ₦862.50
B. ₦840.00Correct
C. ₦806.25
D. ₦750.00

Explanation

Using FIFO: Balance of stock as at 9/5/07 = (100+60−85)=75 bags. Remaining from the 1/5 batch (100−85=15 bags at ₦10.00) + all of the 3/5 batch (60 bags at ₦11.50) = 15×10+60×11.50 = 150+690 = ₦840.00.

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