valuation of inventory

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    Shaharia
    Participant

    if we value inventory at latest invoice price how would it include unrealised profit ?


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    gromit
    Keymaster

    It wouldn’t. Why do you think it would? (NB audit of groups is not on the F8 syllabus).


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    Shaharia
    Participant

    it has been described at bpp text book at pg-257 that a valuation may include unrealised profit if inventory is valued at latest invoice price .


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    gromit
    Keymaster

    I don’t have their text book and don’t understand what they mean – except if the inventory had been sold by one division to another. Then there could be unrealised profit.

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