i am not understand FIFO and AVEREGE METHOD in investment accounting AS-13 (ipcc) .....plzzzzzzz make my concept clear.......
i am not understand FIFO and AVEREGE METHOD in investment accounting AS-13 (ipcc) .....plzzzzzzz make my concept clear.......
Lets take an example:
Bought TiSCO shares 1/4/11- 500 shares at Rs.20 each
on 5/4/11- another 400 at Rs. 40 each.
FIFO-
Sold 600 shares on 11/4/11 at 33 each.
Profil/Loss- [500*(33-20)+100*(33-40)] = INR 5800
Closing BS value of shares- 300*40 = INR 12000
Weighted Average-
Same condition
P/L- [600*(33-x)]
closing balance - x*300
Here x= weighted average price
= [500*20+400*40]/(500+400)
=26000/900
= INR 28.89.
Hope I understood your query.
CAclubindia
