Inventory and IFRS

Question 1

List the three methods of assigning value to inventory under International Financial Reporting Standards (IFRS)

Answer 1

First In First Out (FIFO), specific identification, and weighted average

Question 2

Under International Financial Reporting Standards (IFRS), is reversal of a write down of inventory permitted?

Answer 2

yes

Question 3

Can a company following International Financial Reporting Standards (IFRS) standards use Last In First Out (LIFO) cash flow assumptions?

Answer 3

no

Question 4

How are adjustments for net realizable value applied?

Answer 4

Item-by-item basis

Question 5

Under International Financial Reporting Standards (IFRS), is inventory reported at lower of cost or market OR at lower of cost or net realizable value?

Answer 5

Lower of cost or net realizable value

Question 6

When is inventory reassessed under International Financial Reporting Standards (IFRS)?

Answer 6

At the end of each financial reporting period

Question 7

What is the net realizable value as defined by International Financial Reporting Standards (IFRS)?

Answer 7

The estimated selling price in the ordinary course of business less the estimated costs of completion and the estimate costs necessary to make the sale.