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Post Info TOPIC: IAS 2- why lower ?


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IAS 2- why lower ?
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hi guys

IAS 2 stipulates that we should value inventory at the lower of cost and net realisable value. Why is it important that it should be lower ?



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Master Book-keeper

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So you don't overvalue the stock. Must take a prudent view so the figures are not over inflated.

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 Joanne 

Winner of Bookkeeper of the Year 2015, 2016 & 2017 

Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.

You should check out answers with reference to the legal position



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thanks for reply Joanne. Can you give an example that illustrates the concept?

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Master Book-keeper

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Hi Rafal
I dont really have the time at the moment (sorry but up to my eyes in work!), so Ive nabbed one someone else has done. This is the sort of thing that your tutor should be explaining in full and if they are not I would give some very serious consideration to moving to a good training company. Dont get me wrong - I dont mind answering your questions on here, although I must add the responses might be fewer and further between come the January tax season from most on here. Hope this one helps.

www.learnac.co.uk/index.php/blog/31-valuation-of-closing-inventory-based-on-ias-2

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 Joanne 

Winner of Bookkeeper of the Year 2015, 2016 & 2017 

Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.

You should check out answers with reference to the legal position



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thanks Joanne for link, everything I needed is included in this article, nice blog by the way!

Well, I observed I am slightly slower in class when we analyze material for the first time. Therefore I decided to read at home in advance about stuff that we are going to cover later. IAS 2 is included in material we are going to start analyzing in January but I want to learn a little bit now so that I can keep up in class later. 



-- Edited by rafapak on Tuesday 20th of December 2016 07:53:24 PM



-- Edited by rafapak on Tuesday 20th of December 2016 08:17:50 PM

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Master Book-keeper

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rafapak wrote:

 

Well, I observed I am slightly slower in class when we analyze material for the first time. Therefore I decided to read at home in advance about stuff that we are going to cover later. IAS 2 is included in material we are going to start analyzing in January but I want to learn a little bit now so that I can keep up in class later. 



-- Edited by rafapak on Tuesday 20th of December 2016 07:53:24 PM



-- Edited by rafapak on Tuesday 20th of December 2016 08:17:50 PM


 Hi Rafal

Just one suggestion if I may - if you edit a post, its perhaps best used for typos (of which I make loads of mistakes with all the time cos I never wear my glasses!), as opposed to adding extra information such as the two lines above, as bigger edits will not be seen by those who have read your post earlier.  I only came across this by accident.

It seems to me that you could do very well doing this by distance learning if you find working in a classroom environment hard, certainly its great that you are wanting to know the reasons why you are doing something rather than just learning that it needs to be done, so well done you.   



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 Joanne 

Winner of Bookkeeper of the Year 2015, 2016 & 2017 

Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.

You should check out answers with reference to the legal position



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thanks Joanne for suggestion. So if I want to add more information to my post, what should I do so that people who have read my post earlier have a chance to see my additional information ? Should I quote my earlier post and add information I need to add and finally save everything ?

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Master Book-keeper

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Hi Rafal
Just complete another 'quick reply' post on to the bottom of the others with anything new you want to add. Doesnt matter if you have two answers together. You may see that a lot if someone is responding to more than one person who has posted.

Also you dont need to quote your own post. I might quote yours and answer it, or you might quote mine, but most people tend to do that when they are responding to specific points in a long post.

HTH

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 Joanne 

Winner of Bookkeeper of the Year 2015, 2016 & 2017 

Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.

You should check out answers with reference to the legal position



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thanks for instructions Joanne

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