Beta submitted a statement to Alpha as at the same date showing a balance due of $5,200. Which of the following could account fully for the difference?
Beta has issued a credit note for $500 to Alpha which Alpha has not yet received.
company, according to IAS2 Inventories? 1 Carriage inwards. 2 Carriage outwards. 3 Depreciation of factory plant. 4 Accounts department costs relating to wages for production employees.
1, 3 and 4 only
Which of the following factors could account for the shortfall? 1 Sales were lower than expected. 2 The opening inventories had been overstated. 3 The closing inventories of the business were higher than the opening inventories. 4 Goods taken from inventories by the proprietor were recorded by debiting drawings and crediting purchases with the cost of the goods.
2 only
Which of the following disclosures are required by IAS 8 Accounting policies, changes in accounting estimates and errors in these financial statements? 1 The reasons for the change. 2 The amount of the consequent adjustment in the current period and in comparative information for prior periods. 3 An estimate of the effect of the change on future periods, where possible.
1 and 2 only
1. The balance sheet value of inventory should be as close as possible to net realisable value. 2. The valuation of finished goods inventory must include production overheads. 3. Production overheads included in valuing inventory should be calculated by reference to the company’s normal level of production during the period. 4. In assessing net realisable value, inventory items must be considered separately, or in groups of similar items, not by taking the inventory value as a whole.
2, 3 and 4
