CIMA BA3 · Chapter 9 · Question 7 of 10
Under IAS 2 Inventories, which of the following costs must NOT be included in the cost of inventory?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) Selling costs
Explanation
Cost of inventory includes costs of purchase (including import duties and carriage inwards), costs of conversion (including production overheads allocated on normal capacity) and other costs of bringing the inventory to its present location and condition. Selling costs are excluded and recognised as expenses.
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