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JAMB Principles of Accounts 2014 Question 23

Question 23

Stock Valuation

2/3 Purchases 900 books at ₦1,000 each
4/3 Purchases 590 books at ₦950 each
15/3 Sales 300 books at ₦900 each
Determine the cost of goods sold using FIFO.

  1. A.₦285,000.
  2. B.₦300,000.
  3. C.₦570,000.
  4. D.₦600,000.
Show the answer and explanation

Answer: B (₦300,000.)

Explanation

FIFO takes the oldest books first: 300 × ₦1 000 = ₦300 000.