Agricultural produce at the point of harvest is generally measured under which basis before it becomes subject to IAS 2?
Correct answer: C. Fair value less costs to sell under IAS 41
- A. Historical purchase cost under IAS 2
- B. Net realisable value under IAS 2
- C. Fair value less costs to sell under IAS 41
- D. Replacement cost under IAS 16
Explanation
IAS 41 generally measures agricultural produce at fair value less costs to sell at the point of harvest. That amount then becomes its cost for applying IAS 2 after harvest.
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About Inventory Valuation
Inventory valuation determines the cost of unsold goods and its effect on cost of sales and profit. The work covers inventory counts, included costs, FIFO and weighted-average costing, and the rule that inventory is reported at the lower of cost and net realisable value, not simply at its expected selling price.
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More Inventory Valuation questions
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