Tag: Management

Alex Ltd uses the first-in, first-out (FIFO) method to value its stocks of finished goods.

As at 1 January there were stocks of 25 units that had cost £54 each.

During January, the following transactions occurred:

8 January – 10 units were sold for £62 each
15 January – 10 units were purchased for £55 each
22 January – 10 units were sold for £62 each

What was the value of Alex Ltd’s closing stock as at 13 January?

Select ONE answer:

1. £815
2. £810
3. £825
4. £820

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 4

1. Not correct
2. Not correct
3. Not correct
4. Correct – There are only (25 – 10 + 10 – 10) = 15 units in stock at the end of January. 10 of these are valued at £55, and the remainder at £54: (10 × £55) + ( 5 × £54) = £820

This work is licensed under a Creative Commons Attribution 4.0 International License.

What does GAAP stand for?

Select ONE answer:

1. Generally Agreed Accounting Policies
2. Generally Accepted Accounting Policies
3. Generally Agreed Accounting Practice
4. Generally Accepted Accounting Practice

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 4

1. Not correct
2. Not correct
3. Not correct
4. Correct

This work is licensed under a Creative Commons Attribution 4.0 International License.