Poojitha Raam Vinay
Quick Summary
AS 2 Valuation of Inventories (Issued in June 1981, revised and made mandate for accounting periods commencing on or after April 1999) Definition of Inventory As per Para 3 of AS 2 Inventory includes: Inventory does not Include As per Para 1 of AS 2 inventory does not include:
Daily Limit Reached
You have reached your daily limit of 2 Free Articles
Subscribe to CCI PRO for unlimited access
Why Upgrade to CCI PRO?
- No Ads
- WhatsApp Broadcasts
- Daily E-Newsletter
- Unlimited Articles Access
BEST VALUE
2 YEAR PLAN
3,499
(Inclusive of GST)
1 YEAR PLAN
1,999
(Inclusive of GST)
View all CCI PRO benfits
Already a PRO member? Login here for an ad-free experience.
FAQ :
Inventories are to be valued at the lower of cost or net realisable value (NRV).
Cost includes purchase price, conversion costs (direct labour, allocated fixed and variable overheads), and other costs incurred to bring the inventory to its present location and condition. Interest and borrowing costs are included only if the inventory takes substantial time to get ready for its intended use.
NRV is the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale.
Trade discounts are always reduced from the cost of inventory. Cash discounts are not reduced from the cost but are considered in the profit and loss account.
Disclosures include the accounting policies for inventory measurement, the cost formulae used, and the total carrying amounts of inventories, classified by type (e.g., raw materials, WIP, finished goods).
CAclubindia
