On 31 December 2013 the inventory of tennis rackets for Opal Sports Retailers Ltd consisted of: Required:
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Required:
a) Determine the total value of closing inventory at 31 December 2013 applying the inventory valuation rules contained in the accounting standards pertaining to Australia.
b) It was noted by the assistant accountant, before the final accounts were prepared, that the RR 116 rackets had been superceded and would have to be discounted heavily to be sold. He considered that their expected sales value would be about $10 each. Discuss the effect of this additional information on the valuation of item RR 116 and on the net profit and on the balance sheet of Opal Sports Retailers Ltd.
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...
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a Under the accounting standards the FIFO assumption will be used as th...View the full answer
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ISBN: 9780730302414
4th Edition
Authors: Jacqueline Birt, Keryn Chalmers, Albie Brooks, Suzanne Byrne, Judy Oliver
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