Year End Stock Valuation

System
System Posts: 100,534 🤖 Admin 🤖
edited June 18 in AAT student discussion
Hi everyone<BR><BR>I'm a bit confused about year end stock valuation adjustments. I've been given a closing valuation of £63,295 and have to make adjustments as the selling price of 3 items was reduced after the year end. <BR><BR>They are:<BR>Quantity 10 Cost £30 Normal Selling Price £45 Reduced Selling Price £30<BR>Quantity 10 Cost £80 Normal Selling Price £120 Reduced Selling Price £60<BR>Quantity 8 Cost £50 Normal Selling Price £75 Reduced Selling Price £37.50<BR><BR>I've worked out that there is no change to the first item, but both the second and third result in a lower net realisable value. What I'm not sure of is how I reflect this in the closing valuation. <BR><BR>Thanks for your help.<BR><BR>Vicky<BR>

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  • System
    System Posts: 100,534 🤖 Admin 🤖
    Year End Stock Valuation

    These amounts are familiar!!<BR><BR>Stock Valuation £63,295<BR>Adjustments<BR>(10 x 80) - (10 x 60) = 200<BR>(8 x 50) - (8 x 37.50) = 100<BR><BR>Stock Valuation = £62,995<BR><BR>Always show your working on a paper, the examiners are happy then that you know what u r on about.<BR><BR>Hope that helps a little
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Year End Stock Valuation

    Thanks very much for that ... you've really made my day as I'd worked it out to that but was convinced I was wrong!!<BR><BR>Thanks again.<BR>

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