Recognisation of assets
Querist : Anonymous
It should be recognized or not?
A restaurant maintains a base stock inventory of silverware and dishes in an unchanging amount. Additions to the
stock are charged to expense. On average, the turnover of these items is two years. Is it appropriate to classify the
dishes and silverware as property, plant and equipment?
Yes. They are tangible assets held for use in the supply of goods and services and are expected to be used for more
than one period. They should not be included in current assets.
Querist : Anonymous
Querist : Anonymous
In respect of reusable items such as rotables, galley equipment and tooling etc.,NRV takes into consideration provision for obsolescence and wear and tear and net of provisioning for non – moving / slow moving items.
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Analysis:
If the case is made that there will always be minimum stock then the minimum stock can be part of inventory.
However, bringing in inventory in the curent period may need an adjustment to opening retained balance.
In respect of reusable items such as rotables, galley equipment and tooling etc.,NRV takes into consideration provision for obsolescence and wear and tear and net of provisioning for non – moving / slow moving items.
------------------------------------------
Analysis:
If the case is made that there will always be minimum stock then the minimum stock can be part of inventory.
However, bringing in inventory in the curent period may need an adjustment to opening retained balance.
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