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Inventory valuation for jewellers

This query is : Resolved 
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(Querist)
28 June 2013 How does one value the closing stock in a no sale situation.
Eg. Opening stock = 100Gms gold @ Rs.2500/gm
Purchases = 100Gms gold @ Rs.3000/gm OR the other way round
Sales = 0
Closing Stock Valuation??
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CA PARAS BAFNA

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CA PARAS BAFNA (Expert)
28 June 2013 Adopt the policy of valuation-
"Cost or market value which ever is lower. "
.
Cost :
100x2500+100x3000= 250000+300000=550000.
.
Market Value or Net Realisable Value is say
Rs. 2700/gm .
200x2700= 540000
.
Valuation will be taken at 540000/-
.
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Nikita

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Nikita (Querist)
29 June 2013 So Sir, if this is taken at NRV i.e. Rs.540000/- so will it be a no profit no loss situation as there are no sales?
To earn a profit or incur a loss, we need to have sales and as per the case there are zero sales?
And the answer to this will be as per which law or accounting standard?
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