At 1 October 2018 Bradley Ltd held inventory with a cost of $800 000 and a fair value of $1 000 000. In order to hedge against a fall in the fair value of its inventory below $1 000 000 Bradley acquired a derivative. At 31 December 2018 the fair value of the entity's inventory had fallen by $40 000 and the derivative had a value of $40 000

At 31 December 2018 at what value should the inventory be recognised in the financial statements?

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In this scenario Bradley Ltd held inventory with an initial cost of 800000 and a fair value ... View the full answer