PRC-1 · Chapter 7 · Question 75 of 100
In which of the following scenarios does IAS 2 require the use of the 'Specific Identification' method for assigning costs to inventory?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) When inventory items are not ordinarily interchangeable and goods or services are produced and segregated for specific projects.
Explanation
IAS 2 mandates specific identification of costs for items that are not ordinarily interchangeable and for goods or services produced and segregated for specific projects.
More IAS 2: Inventories MCQs
- Q77Which of the following costs is treated as a period expense rather than being capitalized into the cost of ending inventory?
- Q78Under a perpetual inventory system, what is the correct double entry for recording a purchase return of goods previously bought on credit?
- Q79Which of the following best describes the 'Retail Method' of estimating inventory cost?
- Q80Under normal circumstances, raw materials are not written down below cost if the finished products they make will be sold at a profit…
- Q81An entity had opening inventory of 36,000 units @ Rs. 3.9 per unit. During the month, it purchased 41,000 units @ Rs. 4.5 per unit. Sales…