Page 91 - F3 -FA Integrated Workbook STUDENT 2018-19
P. 91
Inventory
Example 1
Inventory valuation
Callum has provided the following information relating to four items of
inventory:
1 Cost $100 and could be sold for $120, less selling costs of $10
2 Cost $150 and could be sold for $160, less selling costs of $20
3 Cost $135 and could be sold for $148, less selling costs of $15
4 Cost $127 and could be sold for $125, less selling costs of $5
Required:
For each item of inventory, apply the valuation principles of IAS 2
Inventories determine its correct valuation for inclusion in the financial
statements.
Solution
1 2 3 4
$ $ $ $
Cost 100 150 135 127
Net realisable value 110 140 133 120
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Inventory valuation 100 140 133 120
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