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According to IAS 2 Inventories, which of the following costs should be included in valuing the inventories of a manufacturing company?

According to IAS2 Inventories, which of the following costs should be included in valuing the inventories of a manufacturing company? (1) Carriage inwards (2) Carriage outwards (3) Depreciation of factory plant (4) General administrative overheads

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Question added by Asad zaman , Audit/Finance , Rafaqat Baber and co
Date Posted: 2014/08/06
irfan khalid
by irfan khalid , Senior Sales Executive , Ghantoot Group ( Bin Mehran Ready Mix Concrete)

AS PER IAS2 INVERNTORY SHOULD INCLUDE DIRECT COSTS AND OPTION1 IS CORRECT.

EXPLAINATION IS GIVEN BELOW FOR YOUR UNDERSTANDING

IN INVENTORY Cost should include all....

  • costs of purchase (including taxes, transport, and handling) net of trade discounts received
  • costs of conversion (including fixed and variable manufacturing overheads) and
  • other costs incurred in bringing the inventories to their present location and conditio

Inventory cost should not include...

  • abnormal waste
  • storage costs
  • administrative overheads unrelated to production
  • selling costs
  • foreign exchange differences arising directly on the recent acquisition of inventories invoiced in a foreign currency
  • interest cost when inventories are purchased with deferred settlement terms.

Amaresh Singh
by Amaresh Singh , Asst. Manager - Accounts , Shreyas Relay Systems Ltd

carraige inward

Akram Massoud
by Akram Massoud , FINANCE MANAGER , Autoexcellence LTD

Cost should include all: [IAS2.10]

costs of purchase (including taxes, transport, and handling) net of trade discounts received

costs of conversion (including fixed and variable manufacturing overheads) and

other costs incurred in bringing the inventories to their present location and condition

Abdul Qayyum Mohammed
by Abdul Qayyum Mohammed , Sales And Marketing Manager , Zafar Naji Al-Muthlaq Contracting Establishment

Carraige Inwards cost will increase the value of material/purchases and it appears in Debit side of Trading Account under the purchases.

  1. So, the carraige inwards will be a part of inventory evaluation.

Ahmed Al Akhzami
by Ahmed Al Akhzami , Finance Det , Saud Bahwan Auotmovtive LLC

Carraige Inwards cost will increase the value of material/purchases and it appears in Debit side of Trading Account under the purchases. 1.So, the carraige inwards will be a part of inve

IN INVENTORY Cost should include all....

  • costs of purchase (including taxes, transport, and handling) net of trade discounts received
  • costs of conversion (including fixed and variable manufacturing overheads) and
  • other costs incurred in bringing the inventories to their present location and conditiontory evaluation.

Ezzidin Ibrahim
by Ezzidin Ibrahim , Financial Controller , Karim Food Industries

(1) Carriage inwards, this part of the cost for the inventory

Mohamad yasin Tohmaz
by Mohamad yasin Tohmaz , Senior Buyer Pharmacist , Taiba Hospital

carriage inwards

carriage outwards

depreciation of factory plants

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