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What is measurement of Inventories? a) At time of Stock b) At time of disposal

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Question ajoutée par Malik Khalid Mahmood , Regional Finance Manager , Leosons International FZ LLC
Date de publication: 2014/11/30
VENKITARAMAN KRISHNA MOORTHY VRINDAVAN
par VENKITARAMAN KRISHNA MOORTHY VRINDAVAN , Project Execution Manager & Accounts Manager , ALI INTERNATIONAL TRADING EST.

Techniques for the measurement of the cost of inventories, such as the standard cost method or the retail method, may be used for convenience if the results approximate the actual cost. Standard costs take into account normal levels of consumption of materials and supplies, labour, efficiency and capacity utilisation. They are regularly reviewed and, if necessary, revised in the light of current conditions. The retail method is often used in the retail trade for measuring inventories of large numbers of rapidly changing items that have similar margins and for which it is impracticable to use other costing methods. The cost of the inventory is determined by reducing from the sales value of the inventory the appropriate percentage gross margin. The percentage used takes into consideration inventory which has been marked down to below its original selling price. An average percentage for each retail department is often used.

Malik Khalid Mahmood
par Malik Khalid Mahmood , Regional Finance Manager , Leosons International FZ LLC

Thanks Sir for Valuable Contribution as a Expert

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