Inventories

Question 1

the cost of inventories

Answer 1

shall compromise all the costs of purchase, costs of conversion and other costs incurred in bringing the inventories to their present location and condition

Question 2

Cost of conversion

Answer 2

Direct costs of material and labor + indirect costs of production (variable and fixed production overheads)

Question 3

Cost of purchase

Answer 3

Purchase price + import duties and other taxes + transport and handling costs + other directly attributable costs - Trade discounts and rebates (other costs and borrowing costs)

Question 4

Not included costs inventories

Answer 4

abnormal amounts of wasted materials, storage costs, administrative overheads, and selling costs

Question 5

Measurement inventories

Answer 5

measured at the lower of cost and net realizable value (NRV)

Question 6

Net realizable Value (NRV)

Answer 6

net amount that an entity expects to realize from the sale of inventory in the ordinary course of business

Question 6

calculation NRV

Answer 6

Estimated selling price - costs of completion - selling costs

Question 7

Materials held for use in production measurement

Answer 7

are not written down below cost if the finished products in which they will be incorporated are expected to be sold at or above cost