accounting standard 2

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devanshi chinoy (Querist)
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10 April 2011 hey i m an ipcc student and this is a query regarding as 2 'valuation of inventories'
the sum is
y ltd purchased 500 raw materials @ Rs 150 per unit gross less 10% trade discount sales tax is chargeable on the net price. the excise duty on product is Rs 12 per unit against which MODVAT can be claimed .The company spent Rs 1000 on transportation and Rs500 on loading and unloading . Calculate the cost of purchase of raw materials
please help me solve this asap... thank you!

JIGAR DALAL

JIGAR DALAL (Expert)
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10 April 2011 The Cost of Purchase of Raw material will be
purchase Price (500*150)
Less: trade Disc. (10% of RS. 75000/-)
Add: Freight Inward & Loading & Unloading Charges (Rs. 1500/-)

Net Purchase cost Rs. 69000/-

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CA Sumat Singhal

CA Sumat Singhal (Expert)
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10 April 2011 Cost of Inventories
6. The cost of inventories should comprise all costs of purchase, costs of conversion and other costs
incurred in bringing the inventories to their present location and condition.
Costs of Purchase
7. The costs of purchase consist of the purchase price including duties and taxes (other than those
subsequently recoverable by the enterprise from the taxing authorities), freight inwards and other
expenditure directly attributable to the acquisition. Trade discounts, rebates, duty drawbacks and other
similar items are deducted in determining the costs of purchase.
regards
CS SUMAT SINGHAL

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devanshi chinoy

devanshi chinoy (Querist)
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10 April 2011 i have the answer to this which is Rs 72375

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