Applying the rules in SSAP 9, determine the value that should be given to stocks in each of the following cases.

(a) Two hundred and fifty units of a universal flange were bought at £3.75 per unit two years ago, and they are still in stock. The management accountant has ordered a thorough review of stocks and his stock audit team has estimated that these flanges could be sold on the open market for £4.10, providing they are cleaned and repackaged, at a cost of £0.225 and £0.4 per unit respectively.

(b) Hesco Ltd designs and prepares plastic signs, such as name plates, direction signs, and so on. Earlier this year it bought 1,000 m/ of a special style of plastic sheet, to fill an order.
Since that time, the demand for signs in this style has fallen away. During the firm’s annual audit, the auditors determined that the plastic sheeting, of which 345 m? remain in stock, cost £0.59 per m* to buy and could be disposed of for £0.75 per m. If the sheeting is to be sold, the estimated selling costs would amount to 0.15 per m2, and the imputed cost of holding this sheeting in stock is £0.10 per unit.