PRESENTED BY; SHUAIB ADEADEBAYO ACA,CFE,ACCA…….

IAS 2 States that inventory must be valued at lower of cost and net realizable value

DOES NOT APPLY TO THE FOLLOWING

ELEMENTS OF INVENTORIES ARE:

COST OF INVENTORIES

COSTS OF CONVERSION

ISSUES TO REMEMBER

N

Opening Inventory X Add: Purchases X Add: Carriage Inwards

X Less: Returns Outwards (X) Total goods Available X Less: Closing Inventory (X)COST OF GOODS SOLD X

COST OF GOODS SOLD FORMULA