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Former Member
Jul 21, 2009 at 07:17 AM

FIFO valuation

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Dear experts,

Kindly explain how the system calculates FIFO Valuation for single receipt.

FIFO Valuation Based on Single Receipts

When you use single receipts as a basis, the system splits up the values from invoices among the goods receipts in chronological order on a progressive quantity fill-up basis.

Quantity

Value

FIFO receipt value

1st goods receipt

20 pieces

200.00

= $240.00

2nd goods receipt

80 pieces

800.00

= $860.00

The FIFO value of the two goods receipts is calculated as follows:

$200.00 + (20 pieces x $100.00 / 50 pieces) = $240.00 or

$800.00 + (30 pieces x $100.00 / 50 pieces) = $860.00

The FIFO value of the closing stock is thus 30 pieces x $860.00 / 80 pieces = $322.50.