Chuẩn Mực Báo Cáo Tài Chính 1

CHAPTER 2:
IAS 2 INVENTORIES

LECTURER: PHAM TU ANH
INDUSTRIAL UNIVERSITY OF HO CHI MINH CITY


Content
1. Scope
2. Definition
3. Measurement
of inventory
4. Cost formula
5. Additional
issues


I. SCOPE


I. SCOPE
EXERCISE:
Which of the following example is in or out IAS 2?
a. The lumber of a furniture manufacturer
b. The chicken of a poultry farmer


II. DEFINITION
Inventories are assets:
Held for sales in the
ordinary course of

business

In the process of
production for such
sale

In the form of materials
and supplies to be
consumed in the
production process or in
the rendering of services


II. DEFINITION
Question: Whether it is inventories or not????
◦Ex1: An entity trades in commercial property (ie it buys
commercial property with a view to selling it at a profit in the
near term).
◦Ex2: An entity holds lubricants that are consumed by the
entity’s machinery in producing goods.
◦Ex3: An entity holds a building to earn rentals under operating
leases from independent third parties.
◦Ex4: An entity that manufactures chemicals maintains its
manufacturing plant using a specially designed (bespoke)
cleaning machine acquired from a local store. The machine is
expected to be used by the entity for many years.


II. DEFINITION
Solution:

II. DEFINITION
Question: Exercise 2.8 in textbook

• Notes:
(a) Customers do not receive the goods
(b) The company is the buyer
(e) The company is the consignee


II. DEFINITION
Solution:


II. DEFINITION
Scenario 1:


II. DEFINITION
Scenario 1:

Manager:
Johan
Build

Employee


II. DEFINITION

Scenario 1:

Manager:
Johan
Build

Employee


Scenario 2:
◦ABC
is
company
which
specializes in manufacturing
car doors.
◦Frank Burns is the manager
has he make a meeting with
you in a day that is convenient
for both of you.


Scenario 2:


III. MEASUREMENT OF
INVENTORY
LOWER

III. MEASUREMENT OF
INVENTORY

Cost of inventory = costs of purchase + costs of conversion + other costs.
◦ Costs of purchase = purchase price + import duties + other taxes (non-refundable in
nature) + other direct costs (transport and handling) - Trade volume rebates (trade
and cash discount)
◦ Costs of conversion = direct costs + indirect costs (allocated production overheads).
◦ Other costs (eg: specific design expenses incurred in producing goods for individual
customers)


Scenario 1:


Solution of Scenario 1:


Scenario 2:
A retailer buys a good priced at CU500 per unit. However, the
supplier awards the retailer a 20 percent discount on orders of
100 units or more. The retailer buys 100 units in a single order.
Require: Compute the cost of goods?
Solution:


Scenario 3:
A retailer buys a good priced at CU500 per unit. However, the supplier
awards the retailer a 20 per cent discount on orders of 100 units or more.
Furthermore, when the retailer has purchased 1,000 or more units in a

calendar year, the supplier awards the retailer a further volume discount of
10 per cent of the list price. The additional volume discount applies to all
units acquired by the retailer during the calendar year.
On 1 January 20X1 the retailer buys 1,000 units from the supplier in a
single order.
Require: Compute the cost of goods?
Solution:


Scenario 4: Exercise 2.2 in textbook

Require:
a. Calculate the value of inventory?
b. Journalize the transactions, using the accounts as follows:
+ Merchandise inventory
+ Trade payable
+ Interest expense


Solution of Scenario 4:


Scenario 5:
Accurate Laser-Guided Farm Implements, Inc. purchases lasers, a
component that it uses in manufacturing its signature product. The
company typically receives delivery of all its component parts and uses
them in manufacturing its finished products during the fall and early
winter, and then sells its stock of finished goods in the late winter and
spring. The supplier invoice for a January delivery of lasers includes the
following line items:

Lasers
€5,043
Shipping and handling
125
Shipping insurance
48
Sales tax
193
Total
€5,409
Require: Compute the cost of lasers?
Solution:


Scenario 6: Exercise 2.16 in textbook


Solution of Scenario 6: