Question

how to calculate store ledger by using simple average method

Answer 1

In this simple average method...the price for issue is calculated as an average of prices of materials present..issue price= total of unit prices/no. of prices..... suppose we Purchased 1000 units at 20rs each..and later purchased 500 units at 10rs each.... If there is an order to issue 1200 units..then it should be calculated in the following way....issue price= total of unit prices/no.of prices..i.e.., issue price = 20+10/2=15....so 1200×15 =18000 will be the issue price...in this way we will calculate issues in Store ledger under simple average method..hope it helps!