The cost of inventory should not includea.Purchase price.b.Fixed and variable production overhead.c.Abnormal amounts of wasted materials.d.Import duties and other taxes.

The cost of inventory to the firm includes all of the following EXCEPT:

Which of the following costs is not included in the Merchandise Inventory account?Multiple ChoiceInvoice price minus any discount.Import duties.Storage.Insurance.Damaged inventory that cannot be sold.

73. Mario has incurred the following costs in relation to a unit of inventory: Particulars $ Raw materials cost 1.50 Import duties 0.40 Direct labour 0.50 Subcontracted labour costs 0.80 Recoverable sales tax 0.20 Storage costs 0.05 Production overheads (per unit) 0.25 There was a problem with the first batch of items produced, so abnormal wastage costs of $0.10 per unit have also been incurred by Mario. At what cost should Mario value this inventory in its financial statements? A $3.50 B $3.45 C $3.80 D $3.70 74. Which of the following statements regarding consolidated financial statements is correct? A For consolidation, it may be acceptable to use financial statements of the subsidiary where the year‐end differs from the parent by 2 months. B For consolidation, all companies within the group must have the same year end. C All companies within a group must have the same accounting policy in their individual financial statements. D The profit made on all intra‐group sales in the year must be removed from the consolidated financial statements. 75. ‘An associate is an entity over which the investor has significant influence’ (IAS28, para 3). Which TWO of the following indicate the presence of significant influence? A The investor owns 330,000 of the 1,500,000 equity voting shares of the investee B The investor has representation on the board of directors of the investee C The investor is able to insist that all of the sales of the investee are made to a subsidiary of the investor D The investor controls the votes of a majority of the board members

As inventory quality increases, its cost usually .

Question # 1The cost of inventory on hand of a firm on 31-12-2013 was Rs. 800,000.There were doubtsregarding its condition and net realizable value. It was found that:• The good stocks were 75% and were expected to realize the normal sales price of costplus 25%.• 15% were slightly damaged and required an expenditure of 10% of the sale value formaking it readily saleable at the normal price.• 10% was damaged and would fetch only 60% of the normal sale price.Required:Value of inventory to be shown in the statement of financial position