Assignment 9

• How can we explain the inventories in accordance with SLAS 05




1) In according to the SLAS 05 Inventories are assets;

a) Held for sale in the ordinary course of business;

b) In the process of production for such sale; or

c) In the form of materials or supplies to be consumed in the production process or in the rendering of services.





• What are the inventories that we couldn't apply this standard?



a) Work in progress arising under construction contracts, including directly related service contracts.

b) Financial Instruments (Eg;Treasury Bills & Bonds)

c) Biological assets related to agricultural activity and agricultural produce at the point of harvest.



• What are the costs of inventories?

a) Costs of purchase

b) Costs of conversion

c) Other Costs



• What are the includes in cost of purchases?



a) The cost of purchase of inventories comprise the purchase price, import duties, and other taxes(other than those subsequently recoverable by the entity from the taxing authorities),and transport, handling and other costs directly attributable to the acquisition of finished goods, materials and services. Carter De Costa, http://lahirumanagement.tk/