Ch 2 · AS-2 Inventory Valuation

📘 Core concepts

1. 1Inventory valued at lower of Cost or Net Realisable Value (NRV).
2. 2Cost includes purchase, conversion, other costs to bring to present location & condition.
3. 3Cost formulae: FIFO, Weighted Average. LIFO prohibited under AS-2 / Ind AS 2.
4. 4NRV = estimated selling price − costs of completion − costs to sell.
5. 5Abnormal waste, storage costs, admin overheads are excluded from cost.