00:01
To calculate the value of inventory.
00:06
We can on the balance sheet of modern life limited as on march 31.
00:13
We can follow the steps which explain step 1 identify cost of each of inventory.
00:21
So first opening inventory cost 20 washing machine multiply by $880 each that is 17 ,600.
00:32
This is the opening now purchase in march 40 washing machine 910 each this is $36 ,400 then import duty 40 washing machine multiply by $100 each it will become $4 ,000 now this step to select cash flow method to hear this particular company use the before method which is first in first out at step 3 determine the cost of products.
01:18
So cost of products we have to find like for the ending inventory, which is 22 machines to hear 20 machine multiply by 910 each which is $18 ,200 and 2 machines with 1000 each includes import duty.
01:42
It will be $2 ,000 now total ending inventory will be $18 ,200 plus $2 ,000 which is $20 ,200 now at step 4 we have to for the fourth part determine the net realizable value and rv for each product.
02:07
So this plans to decrease the selling price of washing machine selling price of washing machine on hands on to 500 each since the selling price is less than the original cost.
02:25
So the energy in the ending inventory ending inventory at will be at $500 each now compare cost versus an rv so we can versus an rv to hear when we talk about the cost of ending inventory.
02:55
It will be $20 ,200 and an rv of ending inventory.
03:02
It will be like $11 ,000 for 22 machines...