UK Meaning of 'cost of issue'

[ms.junkmail]

Hi there. I am studying AAT Level 2 in England currently. English is not my first language and generally I do not have problems with the course. But now I have hit a barrier. I do not understand basic term of what an 'issue' means. So here we go:

- Firstly we need to determine the cost of materials issued to production cost centres.

What does it even mean? Could someone please explain me in own words. I study independently and just fail to understand. I will also upload a photo with this thread to show what I mean. Help is much appriciated.

Thank you!

 

[Drmdcpa]

Issue in the words you presented means to give or allocate. The raw materials inventory control department issues, gives or allocates raw materials to the production department.

 

[ms.junkmail]

OK. Thank you for your response. So the receipts are simply the raw materials purchase receipts? And so the issues represent basically the same units given/issued to the production department? But purchases were made at different times at different prices the inventory must be calculated either using lifo, fifo and avco because it is impossible to make sure which units of the same product cost more or less?

Thank you, I am starting to get this!

 

[Drmdcpa]

Costs allocated will be different based on which allocation method is used (fifo, lifo, avco).

This is a standard problem in academic studies to demonstrate how costs can vary based on the different methods.

 

[ms.junkmail]

Thank you sir. Case closed.