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CA Intermediate · Cost and Management Accounting · Material Cost

Which one of the following is the correct description of the 'Bin Card' used in material control?

A Bin Card is kept by the storekeeper and records only quantities received, issued and the balance for each material. It carries no monetary values. The record showing both quantities and values is the Stores Ledger, maintained in the cost accounts department.

  1. AA record kept by the stores keeper showing only quantities received, issued and balance of a material, without valuesCorrect
  2. BA record kept by the cost accounts department showing quantities and values of receipts and issues
  3. CA document sent by the stores to the purchase department requesting purchase of material
  4. DA document prepared by the stores on receipt of material, recording its inspection result

Explanation

A Bin Card is maintained by the storekeeper for each item and records only physical quantities of receipts, issues and balance. Values are recorded in the Stores Ledger kept by the cost department, which is why the second option describes the Stores Ledger and not the Bin Card.

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