• Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

Stock Control.

Extracts from this document...

Introduction

Stock Control Stock control is essential. Records and keeping an update of stock is of high importance. Stock must be motivated by not only one person and re-checks should be carried out. The store keeper should ask a superior for the latter. Records should show: The present current stock - for the company to know what is in stock & so when it comes to stock taking there won't be any problems. Stock Description - to be able to distinguish one item from another. Usually stock is in number format with a barcode or item number. The Re-order level - for the company to be aware that it is in- need of ordering new stock. The Re-order quantity - the amount that the company usually orders when the re-order level is reached The Expiry date - so the company would not finish with old stock in the stock rooms without selling it before it expires. Usually companies offer a special offer on the item to attract customers to buy it. Etc... It is important for a company to keep such records because if not the company would not know what is going on with its stock, thus causing disadvantages for the company. These disadvantages are: * Disadvantages of holding too much stock - Buying too much cost can be an expense to the company. ...read more.

Middle

2. Purchase Requisition A purchase requisition note is sent to the purchasing department from the storekeeper to place an order of the necessary stock needed. 3. Inquiry An inquiry is sent to various suppliers regarding the stock needed so the suppliers can send various quotations and the company then chooses the best cost price and quality. 4. Quotations The company receives these various quotations regarding the stock in need of purchase and the company then chooses the best cost price and quality. 5. Purchasing Order A purchase order is sent to the selected suppliers after the purchasing department has chosen which is the best quotation, quoting how much stock the company would need and any other specified information of stock needed. 6. Delivery Note The delivery note is given to the storekeeper by the supplier quoting the amount of stock that has arrived. Usually a delivery note has two copies so when the stock arrives the store keeper signs this note and one is returned to the supplier specifying delivery and the other is kept by the storekeeper with a record of each receipt. The store keeper checks the actual stock with the delivery note and the purchase order. 7. Goods Received Note The goods received note is raised by the storekeeper from the delivery name signed by him and sent to the purchase department acknowledging the receipt of goods. ...read more.

Conclusion

it takes into consideration that goods are issued in reverse order from that in which they are received * Closing stock valuation is not similar to the most recent prices * When the old stock is being used they would be selling at the old out-of-date prices AVCO = Average Weighted Costs - in this method the average costs are calculated and every time something is bought a new average cost is calculated. Advantages * Over a number of accounting periods reported profits are almost alike . I.e. both high and low profits are avoided. * The irregularity in purchase price is set alike so the prices do not vary greatly. * Logical i.e. AVCO assumes that even though the items were bought at different times they still carry the same value * The closing stock valuation is close to the current market values. Disadvantages * AVCO is difficult to calculate * Issues and stock valuation could have prices that never existed * It is possible for issues not to be at current prices and sometimes when the price is rising it could be below current prices. Comparing FIFO, LIFO, and AVCO FIFO and LIFO are almost the total opposite of each other cause one uses up the old stock first whilst the other just takes from the new stock and leaves the old stock pending whilst as for AVCO is almost in the middle as it just takes the average of all and relies on that price. Financial Recording 1 By: Kirsten Ann Demicoli ...read more.

The above preview is unformatted text

This student written piece of work is one of many that can be found in our GCSE Accounting & Finance section.

Found what you're looking for?

  • Start learning 29% faster today
  • 150,000+ documents available
  • Just £6.99 a month

Not the one? Search for your essay title...
  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

See related essaysSee related essays

Related GCSE Accounting & Finance essays

  1. In this assignment I am opening a tuck shop in the school grounds and ...

    cost = 52p Average cost = 80p/3 = 26.666p (rounded to 27p) Revenue (selling price) Crisps = 35p Drinks = 45 Chocolates = 30p Total revenue = �1.10 Average cost = 110p/3 = 36.666p (rounded to 37p) To work out my Break even I need to use a formula which

  2. Identifying and describing the main financial service needs for a student starting at university

    I have set out a table showing the different types of saving accounts. ISA at Halifax AMOUNT AER GROSS p.a. �18,000+ 4.15% 4.15% �12,000+ 3.95% 3.95% �6,000+ 3.85% 3.85% �3,000+ 3.65% 3.65% �1+ 3.55% 3.55% You can open an ISA Account with a minimum opening balance of �1.

  1. Costs, Profits and Break-even Analysis.

    We call the demand for this product ELASTIC. This figure literally means that the increase in demand was double the decrease in price. In this situation you would clearly want to cut your price as cutting it has generated a lot more business, and so although you're getting less money

  2. Investigating financial control for a new restaurant.

    The first way you calculate break even is by this formula: Break-Even= Fixed Cost (Selling price per unit - Variable Cost per unit) (Contribution) Selling price is the price Mark puts on the food that his selling. Variable cost is the cost that does change regarding to output, an example of a variable cost is raw materials ( food stock)

  1. Financial Control

    As the output increases, the variable costs are incurred, this means that the total costs also increase. Fixed costs: Fixed costs are business costs which are not directly related to the level of production or output. Therefore if the fixed costs of producing 100 items are �100, the costs of producing 150 items are also �100.

  2. The Purpose of Keeping Accurate Accounts

    If pay off materials quickly suppliers can be committed for long term trading for the business. Accounts for social clubs Few clubs and societies records are kept in double entry. The cash book is the minimal accounting record a business can have, the equivalent to this is a receipts and payments accounts, which are made yearly.

  1. Project DR: Manufacturing Division

    Fixed costs consisted of supervisor salary, rent, depreciation, and corporate overhead costs. The fixed costs followed the same trend as the variable costs due to the increased complexity of the Quik Calc versus the Accurer, and the Pocket Pal. The contribution margin and break even figures followed a different trend.

  2. Business systems Babatunde Onaola - Identify and use planning, control methods in conjunction with ...

    Rent and executive salaries are two examples. The total variable cost, on the other hand, is the sum of all the expenses that fluctuate directly with the level of activity or sales. Cost of materials to produce a product or purchases of items for resale are two variable costs.

  • Over 160,000 pieces
    of student written work
  • Annotated by
    experienced teachers
  • Ideas and feedback to
    improve your own work