CPA "Accounting" knowledge points: Measurement of ending inventory

In the CPA exam, the knowledge point of preparation for inventory depreciation is also commonly tested. It usually appears more in multiple-choice questions and is less likely to appear in comprehensive questions. Let’s talk about it today. Let’s take a look at the measurement of ending inventory, which is also the knowledge point of inventory price reduction preparation.

(1) Measurement of ending inventory

On the balance sheet date, inventory should be measured at the lower of cost and net realizable value. If the cost is higher than the net realizable value, a provision for inventory will be made. Provision for price decline shall be made and included in the profit and loss of the current period.

(2) Case Analysis

At the beginning of last year, Company A had 30 tons of material A at a price of 200,000 yuan per ton. The materials were used to process product B and could produce 10 pieces of product B. The estimated processing cost is 1.2 million yuan, and the estimated sales cost when selling each piece of product B is 50,000 yuan. Company A has signed an irrevocable sales contract to sell product B to company B. The sales price of each piece is 400,000 yuan. At the end of the year, The market price of material A is 360,000 yuan per ton. It is expected that sales expenses of 4,000 yuan will be incurred for each ton of material A sold. Calculate how much of the inventory price decline provision for material A should be made by company A at the end of the period.

A: 100,000 yuan

B: 200,000 yuan

C: 300,000 yuan

D: 400,000 yuan

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Analysis:

1. The cost of Product B is =30*20 120=7.2 million yuan

2. The net realizable value of Product B=40*20- 5*20=7 million yuan

3. The cost of product B is greater than the net realizable value, which means that product B has been impaired, and it also means that material A has also been impaired;

4. The cost of material A is =30*20=6 million yuan

5. The net realizable value of material A=700-120=5.8 million yuan

6. Material A Provision for impairment = 600-580 = 200,000 yuan

So the answer to this question is B

The measurement test points for ending inventory, in addition to the multiple-choice questions in the exam, may also It will involve relevant accounting entries. Candidates must pay more attention. If you want to know more about the "Accounting" subject of CPA, please pay more attention to Shenzhen Sky Network!