01Opening inventory1260 units @ R11 per unit
08Purchased from supplier3150 units @ R12
12Issued to production2310 units
19Returned to supplier525 units (purchased on 08 November)
22Purchased from supplier1575 units @ R13
28Issued to production2625 units

1.1 Use the transactions of Stark Industries to determine the value of the closing stock using the first- in- first out method. This stock consists of a component used in production of the final product. (10 marks)


 The following information relates to the only product made by Mario Traders for the year ended 31 July 2022:

Opening inventory0
Number of units manufactured945 000
Number of units sold (at R310 per unit)756 000
Direct materials cost per unitR94
Direct labour cost per unitR123
Variable manufacturing overheads cost per unitR92
Variable selling expenses per unitR22
Fixed manufacturing overheads costR18 900 000
Fixed selling and administrative expensesR15 750 000
  • Draft the income statement for the year ended 31 July 2022 using the Marginal Costing method (10 marks) 
  • Draft the income statement for the year ended 31 July 2022 using the Absorption costing method (10 marks)

Solved Answers for Management Accounting Assignment 

First in first out is an important method of inventory valuation. In this method of valuation, the inventory that is purchased initially is disposed of first. In the given case scenario of Stark industries, the valuation of closing stock using  the first in first out method is performed as follows …………


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