there was no stock at the beginning of the week 609983

E Ltd’s stock purchases during a recent week were as following:

Day Don't use plagiarized sources. Get Your Custom Essay on there was no stock at the beginning of the week 609983 Get an essay WRITTEN FOR YOU, Plagiarism free, and by an EXPERT! Just from $10/Page Order Essay	Price per unit($)	Units purchased
1	1.45	55
2	1.60	80
3	1.75	120
4	1.80	75
5	1.90	130

There was no stock at the beginning of the week. 420 units were issued to production during the week. The company updates its stock records after every transaction.

(a) Using a first in, first out (FIFO) method of costing stock issues, the value of closing stock would be:

(b) If E Ltd changes to the weighted average method of stock valuation, the effect on closing stock value and on profit compared with the FIFO method will be

A Higher closing stock value and higher gross profit

B Lower closing stock value and higher gross profit

C Lower closing stock value and lower gross profit

D Higher closing stock value and lower gross profit

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