QUESTION $2120$ marks

Hundai Bhd is a company manufacturing automotive components for local and foreign market. On $5$ July $2018,$ the company acquired $1,000$ units of raw materials from supplier to use in the production of automotive component $NK3.$ The following information relates to component $NK3$ :w$[$Cost of material purchased including RM$8,800$ refundable tax,$100,000],[$Cost of conversion,$15,000],[$Administrative cost$,18,000],[$Estimated selling price,$280,000],[$Estimated cost to be incurred to sell the product,$10,000]]$

The supplier usually sells the raw materials on $30$ days interest$-$free credit. However, as a special promotion, the purchase agreement for these raw materials provided for payment to be made in full on $30$ June $2019.$ In acquiring the raw materials, transport charges of RM$1,500$ were incurred. H lai Bhd paid this transportation cost on $5$ July $2018.$ An appropriate discount rate is $10\%$ per year.

Rec ed:

$($a$)$ Explain whether product $NK3$ are items of inventory of Hundai Bhd in accordance with MFRS $102$ Inventories.

$[3$ marks$]$

$($b$)$ Determine AND explain the amount to be recognised at initial measurement for the raw materials purchased for NK$3$ above.

$[8$ marks$]$

$($c$)$ Prepare the journal entries for the transaction $($b$)$ above on $5$ July $2018$ and $30$ June $2019.[4$ marks$]$