The closing inventory of X amounted to $90,000 . excluding the following two inventory lines:
1. 400 items which had cost $56 each. All were sold after the reporting period for $45 each, with selling expenses of $600 for the batch.
2. 200 different items which had cost $70 each. these items were found to be defective at the end of the reporting period. Rectification work after the statement of financial position amounted to $528 , after which they were sold for $74 each, with selling expenses totalling $450.
What figure should appear in the statement of financial position of X for inventory?
Suggested solutions:
Item 1 | Cost | Items | Valuation |
Cost | 56 | 400 | 22,400 |
NRV | 45 | 400 | 18,000 |
Selling Expenses | 600 | ||
Net Realisable Value | 17,400 | ||
Item 2 | Cost | Items | Valuation |
Cost | 70 | 200 | 14,000 |
NRV | 74 | 200 | 14,800 |
Selling Expenses | 450 | ||
Rectification Expenses | 528 | ||
Net Realisable Value | 13,822 |
Closing Inventory | 90,000 |
Item 1 valuation | 17,400 |
Item 2 valuation | 13,822 |
Year End Inventory | 121,222 |
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2015 ACCA F3 INVENTORY