The discontinued inventory had a total value of R45 200 under the first-in, first-out method, and...
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The discontinued inventory had a total value of R45 200 under the first-in, first-out method, and there has been no movement in the discontinued inventory balance since the 2020 financial year. Due to the information loss, the Financial Manager cannot determine the value of the discontinued inventory under the weighted average cost method. The South African income tax rate has remained unchanged at 28% for the past three years. Ignore any VAT implications. Assume all amounts to be material. REQUIRED: 1.1) Discuss whether Cotton Lab Limited can change the inventory accounting pol- icy as decided by the board of directors. The discontinued inventory had a total value of R45 200 under the first-in, first-out method, and there has been no movement in the discontinued inventory balance since the 2020 financial year. Due to the information loss, the Financial Manager cannot determine the value of the discontinued inventory under the weighted average cost method. The South African income tax rate has remained unchanged at 28% for the past three years. Ignore any VAT implications. Assume all amounts to be material. REQUIRED: 1.1) Discuss whether Cotton Lab Limited can change the inventory accounting pol- icy as decided by the board of directors.
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As per the International Financial Reporting Standards IFRS an entity can change its accounting poli... View the full answer
Related Book For
Financial Accounting and Reporting
ISBN: 978-0273744443
14th Edition
Authors: Barry Elliott, Jamie Elliott
Posted Date:
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