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joe bought 300 units of stock and incurred the following expenses
usual price-$3000
trade discount-10%
cash discount-5%
carriage inward-$90
packaging cost=$150
warhousing cost for the month-$60
what is the inventoriable cost for one of the stock?
a)$9.80
b)$9.00
c)$10.00
d)$11.00
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I think it must be a)9.8
By defenition Cost should include all: [IAS 2.10]
1) costs of purchase (including taxes, transport, and handling) net of trade discounts received
2) costs of conversion (including fixed and variable manufacturing overheads) and
3) other costs incurred in bringing the inventories to their present location and condition so
inventoriable cost = cost from supplier (cash discount gets to discounts allowed but not purchases) 3000-10%=$2700 + carriage inward $90 + packaging cost $150(i’m not sure about it, it may be distribution costs but there is no $9.3 in answers)= $2940 / 300 = $9.8
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for me the answer is B.3000*10%/300=9.all other are manufaturing expenses.(carriage inwards,packing.ware hous cost not included in the stock he bought
cost of purchase less trade discount less carriage inward packing cost
warhousing cost=other expense
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