SMN Bhd. until now has valued inventory using LIFO method. However, following changes to MFRS 102 Inventories,
Fantastic news! We've Found the answer you've been seeking!
Question:
SMN Bhd. until now has valued inventory using LIFO method. However, following changes to MFRS 102 Inventories, the use of LIFO method has been disallowed. Therefore, the company intends to use FIFO method for the valuation of the company's inventory. Following are extracts of SMN Bhd.’s most recent financial statements before the application of FIFO method.
Assume that the management estimate the following inventory using FIFO:
2018 | 2017 | 2016 | |
Inventory | 12 | 13 | 10 |
Also, assume that the management believes that the valuation of inventory using FIFO method for period prior to 2016 would produce materially similar results. Assume tax is at 25%.
How to treat this accounting for prior years adjustments?
Related Book For
Accounting concepts and applications
ISBN: 978-0538745482
11th Edition
Authors: Albrecht Stice, Stice Swain
Posted Date: