According to IAS 2 Inventories the general rule for valuation of inventories is that inventories are...

 

Transcribed Image Text:

According to IAS 2 Inventories the general rule for valuation of inventories is that inventories are valued at the lower of cost or net realisable value. The following information relates to an auto parts dealer in Gweru who hold inventory types A. B. C, and D Details C SI5,000 SI0,000 $25,000 S8,000 A B D S8,000 $5,000 Selling price of inventory per unit Purchase price of inventory per unit Value Added Tax Agent's commission per unit Transportation cost per unit Import duties per unit Number of inventory units held as closing 15,000 $7,000 S15,000 S3,000 $25 S1,000 $2.000 $4,000 S50 $30 S70 S50 S50 S50 S50 S500 $1,000 S1.500 S2,000 2,000 5,500 100 stock Required: Determine the value to be reflected in the financial statements for the following types of inventory A, B, C and D (16) Part b IAS 2 inventories has a valuation rule for inventories, with the following information from Daisy's Petals who produces a single homogenous product calculate the value to be recognised in the financial statements if cost of manufacture was $2,900,000 Additional information: Costs of completion are expected to cost $500,000 Selling expenses are expected to cost S100,000 Required: Determine the valuation for Daisy's Petals inventory to be recognised. Consider the following scenarios which are independent from each other in determining the value of inventories. Page 10 of 16 a) The sales value of the inventory is $2.700,000. (3) b) The sales value is $4,000,000. (4) According to IAS 2 Inventories the general rule for valuation of inventories is that inventories are valued at the lower of cost or net realisable value. The following information relates to an auto parts dealer in Gweru who hold inventory types A. B. C, and D Details C SI5,000 SI0,000 $25,000 S8,000 A B D S8,000 $5,000 Selling price of inventory per unit Purchase price of inventory per unit Value Added Tax Agent's commission per unit Transportation cost per unit Import duties per unit Number of inventory units held as closing 15,000 $7,000 S15,000 S3,000 $25 S1,000 $2.000 $4,000 S50 $30 S70 S50 S50 S50 S50 S500 $1,000 S1.500 S2,000 2,000 5,500 100 stock Required: Determine the value to be reflected in the financial statements for the following types of inventory A, B, C and D (16) Part b IAS 2 inventories has a valuation rule for inventories, with the following information from Daisy's Petals who produces a single homogenous product calculate the value to be recognised in the financial statements if cost of manufacture was $2,900,000 Additional information: Costs of completion are expected to cost $500,000 Selling expenses are expected to cost S100,000 Required: Determine the valuation for Daisy's Petals inventory to be recognised. Consider the following scenarios which are independent from each other in determining the value of inventories. Page 10 of 16 a) The sales value of the inventory is $2.700,000. (3) b) The sales value is $4,000,000. (4)

Answer rating: 100% (QA)

a A B C D N Number of units in inventory 15000 2000 5500 100 A Selling Price per unit 8000 15... View the full answer