Question 1 (15 marks) Explain the term inventories as per the standard IAS 2 (3 marks) Give two costs that should be included and two costs that should not be included when measuring the value of inventories (2 marks) Red Ltd Co sells three types of products and holds them in its warehouse It has carried out stock taking and produced the following information at the end of the year Products Units in stock Cost per Unit (P) Market Value Table 25 1,250 Damage due to flood so can be sold at P450 each Chairs 115 720 Need repacking that cost P30 each and can be sold for 920 each Cupboards 30 1,370 Cupboards have been damaged due to an accident and cost approximately P320 to repair each and can be sold for P1500 each Required Calculate the value of inventory to be shown in the Red Ltd co financial statement of the year end (10 marks)

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Question: Question 1 (15 marks) Explain the term inventories as per the standard IAS 2. (3 marks) Give two costs that should be included and two

Question 1 (15 marks)

Explain the term inventories as per the standard IAS 2. (3 marks)

Give two costs that should be included and two costs that should not be included when measuring the value of inventories. (2 marks)

Red Ltd Co sells three types of products and holds them in its warehouse. It has carried out stock taking and produced the following information at the end of the year.

Products	Units in stock	Cost per Unit (P)	Market Value
Table	25	1,250	Damage due to flood so can be sold at P450 each.
Chairs	115	720	Need repacking that cost P30 each and can be sold for 920 each.
Cupboards	30	1,370	Cupboards have been damaged due to an accident and cost approximately P320 to repair each and can be sold for P1500 each

Required;

Calculate the value of inventory to be shown in the Red Ltd co. financial statement of the year end. (10 marks)

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