Inventory Valuation Methods (Grade 12 NSC Matric Accounting): Quizzes
📚Quizzes
Practise the questions
10 questions from this quiz
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Practise the questions
10 questions from this quiz
What is the primary purpose of inventory valuation?
What is the primary purpose of inventory valuation?
To determine monetary value of stock
Why must businesses use a consistent inventory valuation method?
Why must businesses use a consistent inventory valuation method?
To comply with standards & allow comparison
Which type of business is best suited to the specific identification method?
Which type of business is best suited to the specific identification method?
Vehicle dealerships
What is a disadvantage of the specific identification method?
What is a disadvantage of the specific identification method?
Very labour-intensive and time-consuming
What does FIFO assume about stock movement?
What does FIFO assume about stock movement?
Oldest stock is sold first
Which business type is most suitable for using the FIFO method?
Which business type is most suitable for using the FIFO method?
Food and grocery stores
Under FIFO, how is closing stock valued?
Under FIFO, how is closing stock valued?
Using the most recent purchase prices
What does the weighted average method do to price fluctuations?
What does the weighted average method do to price fluctuations?
Smooths out price fluctuations over time
If total cost is R61,440 for 5,120 units, what is the weighted average cost per unit?
If total cost is R61,440 for 5,120 units, what is the weighted average cost per unit?
R12.00
In the Energy World example, which method gives the higher closing stock value?
In the Energy World example, which method gives the higher closing stock value?
FIFO at R30,864