Inventory of slow-moving items is generally:
AWritten up to NRV
BReported at sale price
CNot valued at all
DWritten down to NRV
Answer & Solution
Correct answer: D. Written down to NRV
1. Slow-moving inventory's NRV often falls below cost as expected selling price drops.
2. AS 2 requires write-down to NRV when NRV < cost.
3. The write-down is recognised in the P&L for the period.
_Source: ICAI BoS Foundation Paper 1, Ch 4 "Inventories", §3 ¶7_
Related questions
Periodic inventory taking requires:If GST paid on raw materials is recoverable as input credit, the inventory cost is:Borrowing costs may be included in inventory cost when:Adjusted selling price method is typically used in:Under weighted average method, value per unit at issue is computed as:Cost of conversion includes:If opening inventory is understated, current year's net income is:Inventory turnover ratio is most affected by: