Stores ledger account

A stores ledger account is a running record, kept per material, of receipts, issues and the balance of raw materials in both quantity and value. Accountants use it to price issues to production under FIFO, LIFO or weighted average.

ByHoang TruongUpdated July 5, 2026

See it move

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A stores ledger account for Material R opens with 100 units at €4.00 (€400) and receives 100 more at €6.00 (€600), giving €1,000 across 200 units — a weighted average of €5.00 per unit. That single rate prices the 120-unit issue to production at €600 and leaves a balance of 80 units worth €400 carried forward.

Where it fits

SubjectCost AccountingCoreTopicProduct Costing & Cost of Goods ManufacturedCore

The formula

LaTeX

WAP = \frac{V_o + V_r}{Q_o + Q_r}

Variables

$W A P$: Weighted average issue price (€ per unit)
$V_{o}$: Value of the opening balance (€)
$V_{r}$: Value of the receipt (€)
$Q_{o}$: Quantity of the opening balance (units)
$Q_{r}$: Quantity of the receipt (units)

Recalculates the average cost per unit each time new stock arrives, used to price the next issue to production.

Check yourself

PracticeCORE

A stores ledger account for Material K opens the week with a balance of 150 units valued at €8.00 each. A delivery of 250 more units arrives at €10.00 each. Using the weighted average method, what is the cost charged for an issue of 180 units to production later that week?

Select an answer to check your understanding.