ACCA F3 Inventory

The closing inventory of X amounted to $40,000 . excluding the following two inventory lines:

1. 400 items which had cost $8 each. All were sold after the reporting period for $6 each, with selling expenses of $300 for the batch.

2. 200 different items which had cost $80 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 $84 each, with selling expenses totalling $1,200.

What figure should appear in the statement of financial position of X for inventory?

Suggested solutions:

Item 1	Cost	Items	Valuation
Cost	8	400	3,200
NRV	6	400	2,400
Selling Expenses			300
Net Realisable Value			2,100
Item 2	Cost	Items	Valuation
Cost	80	200	16,000
NRV	84	200	16,800
Selling Expenses			1,200
Rectification Expenses			528
Net Realisable Value			15,072

Closing Inventory	40,000
Item 1 valuation	2,100
Item 2 valuation	15,072
Year End Inventory	57,172

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