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Question 14 Part -A Wahda Co. incurred the following transactions during the month...

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Question

Accounting

Question 14

Part -A

Wahda Co. incurred the following transactions during the month of January 2019.

January 1: Beginning Inventory (50 units @ 10 per unit).

January 10: Purchased 40 units @ 11 per unit.

January 15: Sold 60 units @ 15 per unit.

January 22: Purchase 60 units @ 12 per unit.

January 31: Sold 70 units @ 16 per unit.

Required: Use FIFO methods and calculate the following: (5 marks)

  1. Calculate cost of ending inventory on January 31st, 2019
  2. Calculate cost of goods sold for the period ending on January 31st, 2019

Note:

You need to make a table showing the following columns to show your working:

Date

Purchases

Cost of goods sold

Inventory Balance

Part -B

What is the consistency principle as per financial reporting standards and why a company should follow this principle? (1 mark)

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