Complete the Statement of Financial Position as at 28 February 2023.

The physical stock count on 28 February 2023 was 1 009 bicycles. However, 40 bicycles purchased in January 2023 were returned to the supplier. These returned units are no longer part of the stock.

$$\text{Number of units in closing stock} = \text{Physical count} - \text{Units returned}$$ $$\text{Number of units in closing stock} = 1009 - 40 = 969 \text{ units}$$

The First-In, First-Out (FIFO) method assumes that the first goods purchased are the first ones sold. Therefore, the closing stock consists of the most recently purchased units. We will take the 969 units from the latest purchases backwards.

• From January 2023 purchases: Original units purchased: 740 Less: Units returned: 40 Net units available from January 2023: $740 - 40 = 700$ units Value per unit: R2 100 Value of these units: $700 \text{ units} \times R2 100/\text{unit} = R1 470 000$

  Units still needed for closing stock: $969 - 700 = 269$ units.

• From November 2022 purchases: Available units from November 2022: 2 215 We need 269 units from this batch. Value per unit: R2 030 Value of these units: $269 \text{ units} \times R2 030/\text{unit} = R546 070$

The total value of closing stock is the sum of the values from the latest purchases.

$$\text{Total value of closing stock} = \text{Value from January 2023} + \text{Value from November 2022}$$ $$\text{Total value of closing stock} = R1 470 000 + R546 070 = R2 016 070$$

The value of the closing stock of bicycles is $\text{R2 016 070}$.