Confused....
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Am i doing this right. Just an example of a question i had:
Stock been valued at £10000, then it was decided an item in that stock value which would normally be sold £200 would only sell for £100. Do I just take off £200 then add on £100 so new stock value would be £9900?
Stock been valued at £10000, then it was decided an item in that stock value which would normally be sold £200 would only sell for £100. Do I just take off £200 then add on £100 so new stock value would be £9900?
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Comments
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Re:Confused....
You're right. According to the Lower of Cost and NRV principle, your stock will now be valued at £9900.0 -
Re:Confused....
That would be correct on the assumption that the original cost of the stock is higher than £100. e.g. if the stock originally cost £50, then it would be valued at £50 as is lower than the £100.
Sorry to complicate matters but the information provided is talking about what it could be sold for not what it cost!
Adrian0