IAS 2 Inventories summary - applies in 2024

[@CPDbox]

Thanks for watching! Let’s connect: *Newsletter: www.cpdbox.com/ *LinkedIn: www.linkedin.com/in/silviamahutova/ *Instagram: instagram.com/cpdbox/

[@hassanraza-zc5rp]

Simple, summarized and easy to understand, what more can a student ask for.

[@katendefrank2605]

Never seen an awesome teacher like you Thank you so much sylvia

[@barakalugasi5731]

Thanks for making stndards easy and understandable.

[@MyArsil]

Amaizing , easy to understand and everything in a nutshell

[@ogomoditsedodohdikgang]

I don't even know how to thank you for making this so easy to understand 😊keep up the good work

[@CPDbox]

Thank you for your kind words!

[@jhonloyola2792]

Really good!!!! Silvia you are the best

[@atolomartha2117]

i love the clarity 🙏thxz mum

[@phanindrakumarvavilala804]

Interchangeable clarification only bcoz of this video.. i got it.. thanks a lot

[@noel1111]

You’re the best!

[@Aksh4gDhtfah8]

thank you from Ethiopia

[@ummehabiba2036]

Wow, This is super juicy ,full of information 😍😍😍, I don't regret watching the whole video till end.

[@md.shorabhossain7782]

Excellent video

[@olivezeng188]

Thanks ! But where can I get the ppt?

[@ziaulislam5319]

Thank you mam

[@esthersosu1045]

Thanks so much, this is very insightful

[@usamatayyab6112]

Thank you for making easy.

[@mockery5237]

Hi Silvia, do we need to check as a auditor inventory if the balance is 0 at the year end. The Company has transferred its business operations to a another during the last month of the reporting period.

[@mohammedismail235]

Beautiful and wonderful work

[@sqlam]

What’s the difference between standard costing vs cost formulas? Let’s say I’m a manufacturer, and I use standard costing to calculate individual finished goods, which cost are then fixed and recorded in inventories (B/S) and when they are sold, it is transferred to P/L using FIFO method, and during the reporting date, remaining inventories will not be remeasured and remain the same cost (as per previously calculated) Or Cost of finished goods are calculated using the standard costing method and when they are sold, it is transferred to P/L using the standard cost at the transaction date, and ultimately if there are inventories remaining as at the reporting date, they are remeasured again (using the standard costing rate at that time)?

[@neelanmiranda603]

Great... You are awesome

[@mandevibudhathoki492]

We deduct trade discount from purchase and what we do for Cash/ settlement discount received?

[@TheOluwaseunHassan]

Thank you. But would love to get examples

[@tayyabmehrban1515]

So kind of You

[@kahanshah7886]

Mam why we dont consider interest on short term borrowings in stock while we include long term borrowing's interest?

[@uzaifakhan2277]

Mam it was best

[@bibliophile8339]

It was really awesome, I had learned a lot through this video, hope you can make more IAS video, at least 100 IAS video, I guess it gonna really help us and help u to grow your channel

[@awilmohamed7149]

where i can get textbook teacher

[@hamarapage]

Very nice video. Thank you

[@IKnowExcel]

Good evening Silvia! I have a question. Refer to IAS2, should Insurance and property taxes on the manufacturing equipment & factory add to manufacturing overhead cost? Thank you so much for you answer.

[@Nikunj_Bhuptani]

Excellent presentation!!

[@abdulwadudrahaman346]

What does " in the process of production for such sale" mean? Give an example?

[@mcmillanmkhabela795]

If I'm a restaurant owner and I buy cutlery, say 10 plates at $1 and issued 5 to the restaurant and at the end of the year all 10 are still on hand but 5 in the restaurant and 5 in the storeroom then what's my inventory on hand? Basically the question is, are plates in the restaurant still form part of inventory?

[@tiscarocks]

In my opinion, No. The plates are not held for sale at your restaurant in the ordinary course of business. If your restaurant ordinarily did sell plates to the customers then the plates would be considered inventory but assuming you're providing only food service, the plates are not a part of inventory.

[@mcmillanmkhabela795]

@@tiscarocks thanks for your feedback. I'm sure we both agree that these plates cannot be considered fixed assets, is it your view that these plates are not inventory by definition therefore should be expensed as, say cost of sales or operating costs, when they are purchased? Also take note of IAS 2 6(c) Definition of inventory. Thanks and I really appreciate your valuable input

[@tiscarocks]

@@mcmillanmkhabela795 Your question has had me thinking since the past few days. I do think that the plates can be considered a form on fixed assets however I am not sure as to whether they fit the criteria. Perhaps, they fit a current asset category. which in my opinion is not inventory.

[@CPDbox]

Yes, in most cases, the plates are considered inventory as they meet the definition in IAS 2.6. However, sometimes the plates are PPE (IAS 16), or "fixed assets" as you named it. The reason is that they are used for more than 1 year - just imagine expensive stylish wooden or metal plates... as for the cost - yes, it could be negligible for one single plate, but then we have a consideration of "set of plates" - here, the cumulative cost can be material. See IAS 16 on unit of account. I hope this helps!

[@mcmillanmkhabela795]

@@CPDbox Thanks Silvia, I guess from your response since they can fall on either PPE or Inventory it will be individual judgement issue then. Currently we are taking them as inventory because we cannot reliably estimate their useful life and at year-end we do stock take(both warehouse and restaurant ) and opening stock less what's on hand is cost of sales. I'm sure we are on right track

[@mutebipaul8149]

Silvia we have not received any new letter of late

[@akpc612]

Many thanks dear god bless you

[@kotanmiojo]

It's been a while, good to hear from you.

[@tapson.promax3124]

Helpful

[@swethacima4266]

Your videos are excellent

[@md.zahurulislam5667]

Excellent

[@bebobebo5581]

how can I get this summary? I mean PDF or word

[@Ton-gm3lf]

I don't understand it: you can either have *standard cost* (calculated 'norm price') OR *historic price* based on FIFO or average price? Aren't standard price and historic price two completely different things?

[@vipulverma5848]

Standard Cost can only be used if it approximates Actual Cost. If there are wide variations between Standard and Actual then you need to proceed with Actual Cost Calculation for Valuation of closing Inventory. FIFO and W.Avg are just Cost Formulas to compute Cost of Purchase Component from the three Components of Actual Cost. So you are right, Standard Price and Historic Price are two completely different things and Standard Price can only be used when there are not much variances from the Actual Cost.

[@danusilva9411]

Excellent!!

[@savagepanda7669]

Sorry this might sound dumb but can anyone explain me this... She said at 07:10 "When inventories are sold then you need to recognise the carrying amount of the item sold as an expense" But if we are selling the inventory should it counts as income instead of expense?

[@CPDbox]

OK, back to the accounting basics. When you sell some inventories, you have TWO entries: 1) You get cash for sale, that entry is Debit Cash, Credit Income. 2) You need to remove inventories from your stock as you sold it, so your second entry is Debit Cost of sales Credit Inventories. So when she (I) said at 07:10 that sentence, I referred to entry number 2. Does that help? :)

[@savagepanda7669]

@@CPDbox @Silvia of CPDbox Yes that explains it perfectly. I learned double entry system as when inventory is sold you make following entry Debit: Cash Credit: Inventory But Never thought you would reply personally. Just wants to say thanks a lot because this seriously helped me a lot (accounting standards series) making quality education accessible to everyone. I really appreciate it and I'm sure others do too. Hope you're doing well... thanks again

[@CPDbox]

@@savagepanda7669 Well, that single entry would make a mess. Imagine you bought something for 3 and sell it for 4. So when you buy, you book Debit Inventory 3 Credit Cash 3. And now, according to your entry, when you sell for 4, you would book Debit Cash 4, Credit Inventory 4. So your inventory balance is -1... while in reality you have nothing, 0. Do you see my point? You need to remove 3. And your profit will be 1. As for personal responses - this is hard, but I will try to improve! :) There is far more discussion and my personal responses on my website :)

[@susanais2514]

Excellent job Sylvia! I will purchase your course. Only thing is, I had to rewind a few times because you speak very quickly and I struggled keep up attimes :) I noticed you tried to slow down but it would be really helpful if you could speak a little slower. Thanks anyway... fantastic videos!

[@CPDbox]

Thank you for the honest feedback. Will try to improve and slow down my speech :) To fix this quickly, just please set the playback speed to about 0.75 - you can do so by clicking the settings icon in the right lower corner of the video, then the settings menu will reveal and you will simply change the playback speed. I hope this helps!

[@kiduaalute603]

Thanks

[@udamdeergayu2312]

Superb

[@uzaifakhan2277]

Pleaae conduct 1 lecture on relationship between Profit with valuation methods as FIFO or AVCO

[@rebeccavictor4665]

Can I know what kind of app used to deliver the lesson?

[@PortiaKhwekhwe-SA]

You are the best !!!

[@سامحسيد-ص8ج]

Brilliant