AASB 102 requires that inventory is valued at:
A) The lower of cost and recoverable value, on an item-by-item basis where practicable.
B) Cost or fair value for classes of assets and services that are defined as inventories.
C) The lower of cost and net realisable value, on an item-by-item basis where practicable.
D) Cost or deprival value, whichever is the lower, for classes of inventories.
E) None of the given answers.

Question

Quizplus · Accepted Answer

AASB 102 requires that inventories are to be valued at the lower of cost and net realisable value. This means that if the cost of an item is higher than the amount that can be realized from selling it, its value should be written down to the net realisable value. The standard also requires this valuation method to be applied on an item-by-item basis where practicable.

AASB 102 Requires That Inventory Is Valued At