THE SECOND IMAGE IS THE FORMAT I WANT, PLEASE ORIGINAL WORDS, NO PLAGIARISM PLZ

Writing a Brief Issues Memo, Inventory You are a plant accountant for Kelly Corp. You have been asked to draft a brief (1- to 1.5-page) issues memo ("to the files") documenting the accounting for the following issue. Kelly Corp has leased a mine from which it recently extracted 1,000 kilograms of bauxite (a mineral that can be used to make aluminum). Kelly Corp plans to sell the bauxite to aluminum manufacturers. Kelly Corp is analyzing whether its bauxite inventory can be carried at its sell- ing price per ASC 330-10-35-16(b). Assume that quoted market prices are generally available for bauxite, and that the market for bauxite is active. Using the standard memo format, analy ze whether all necessary conditions are met for the accounting treatment proposed. If assumptions are needed to fully evaluate the guidance, identify those assumptions in your analysis. For this particular memo, you are not required to present alternative treatments; assume for this issue that you have solely been asked to document whether the conditions in ASC 330-10-35-16(b) are met. Kelly Corp. leased a mine and has recently extracted 1,000 kilograms of bauxite. Bauxite is a mineral that is used in making aluminum. Kelly Corp. plans to sell the bauxite to aluminum manufacturers at its selling price. Kelly Corp. must determine whether their bauxite inventory can be carried at above cost. [pic 1 [pic 2][pic 31[pic 4] [pic 5)lpic 6] Issues 1 Does the sale of bauxite meet all conditions provided in FASB Accounting Standard Codification 330-10-35-16(0)? Analysis- Issue 1: Does the sale of bauxite meet all conditions provided in AsC 330-10-35- 16(b)? FASB ASC 330-10 (Inventory) provides guidance for determining how to account for inventories and the recognition of income based on the appropriate costs. The requirements are described in par. 35-16 of ASC 330-10, as follows: 35-16 It is generally recognized that income accrues only at the time of sale, and that gains may not be anticipated by reflecting assets at their current sales prices. However, exceptions for reflecting assets at selling prices are permissible for both of the following 1Inventories of gold and silver,when there is an effective govemment-controlled market at a fixed monetary value 2.Inventories representing agricultural, mineral, and other products,with all of the following criteria: 1 Units of which are interchangeable 2 Units of which have an immediate marketability at quoted prices 3. Units for which appropriate costs may be difficult to obtain. The assumptions that the market for bauxite is active and quoted prices are available have been considered. With the assumptions, the bauxite inventory cannot be recorded at above cost. Conclusion- Issue 1 Kelly Corp. has finished evaluating if the bauxite inventory can be recorded at its selling price and has concluded that it did not meet condition No. 3 under 35-16(b). Under ASC 330-10-35- 16(b), the inventory must have interchangeability, easy to find quoted prices, and appropriate costs may be difficult to obtain. However, it is unclear that if the transaction meets condition No. 3. If the market is active, unless the difficulty is fully evaluated and stated otherwise, it is not difficult for aluminum manufacturers to obtain appropriate cost of bauxite, more information is required. Therefore, Kelly Corp. cannot record the transaction at above cost with the given description Writing a Brief Issues Memo, Inventory You are a plant accountant for Kelly Corp. You have been asked to draft a brief (1- to 1.5-page) issues memo ("to the files") documenting the accounting for the following issue. Kelly Corp has leased a mine from which it recently extracted 1,000 kilograms of bauxite (a mineral that can be used to make aluminum). Kelly Corp plans to sell the bauxite to aluminum manufacturers. Kelly Corp is analyzing whether its bauxite inventory can be carried at its sell- ing price per ASC 330-10-35-16(b). Assume that quoted market prices are generally available for bauxite, and that the market for bauxite is active. Using the standard memo format, analy ze whether all necessary conditions are met for the accounting treatment proposed. If assumptions are needed to fully evaluate the guidance, identify those assumptions in your analysis. For this particular memo, you are not required to present alternative treatments; assume for this issue that you have solely been asked to document whether the conditions in ASC 330-10-35-16(b) are met. Kelly Corp. leased a mine and has recently extracted 1,000 kilograms of bauxite. Bauxite is a mineral that is used in making aluminum. Kelly Corp. plans to sell the bauxite to aluminum manufacturers at its selling price. Kelly Corp. must determine whether their bauxite inventory can be carried at above cost. [pic 1 [pic 2][pic 31[pic 4] [pic 5)lpic 6] Issues 1 Does the sale of bauxite meet all conditions provided in FASB Accounting Standard Codification 330-10-35-16(0)? Analysis- Issue 1: Does the sale of bauxite meet all conditions provided in AsC 330-10-35- 16(b)? FASB ASC 330-10 (Inventory) provides guidance for determining how to account for inventories and the recognition of income based on the appropriate costs. The requirements are described in par. 35-16 of ASC 330-10, as follows: 35-16 It is generally recognized that income accrues only at the time of sale, and that gains may not be anticipated by reflecting assets at their current sales prices. However, exceptions for reflecting assets at selling prices are permissible for both of the following 1Inventories of gold and silver,when there is an effective govemment-controlled market at a fixed monetary value 2.Inventories representing agricultural, mineral, and other products,with all of the following criteria: 1 Units of which are interchangeable 2 Units of which have an immediate marketability at quoted prices 3. Units for which appropriate costs may be difficult to obtain. The assumptions that the market for bauxite is active and quoted prices are available have been considered. With the assumptions, the bauxite inventory cannot be recorded at above cost. Conclusion- Issue 1 Kelly Corp. has finished evaluating if the bauxite inventory can be recorded at its selling price and has concluded that it did not meet condition No. 3 under 35-16(b). Under ASC 330-10-35- 16(b), the inventory must have interchangeability, easy to find quoted prices, and appropriate costs may be difficult to obtain. However, it is unclear that if the transaction meets condition No. 3. If the market is active, unless the difficulty is fully evaluated and stated otherwise, it is not difficult for aluminum manufacturers to obtain appropriate cost of bauxite, more information is required. Therefore, Kelly Corp. cannot record the transaction at above cost with the given description