@@maya_008yea but depend on situation of the time, in current financial year it would acts like the goods unsold ( closing) then it was brought down to next financial year which was opening inventory
bro can you help me with a question that says it is estimated that half of the motor expenses related to miriam's personal use what should i do with this transaction pls help me
Becuase value inventory at lower of NRV (selling price in this case) or cost. In first one, SP < cost and in second one, Cost < SP. So choose the one which is lower.
Because next year’s opening inventory will be overstated and that increases the cost of sales (because cost of sales = opening inventory + purchases - closing inventory)
U would also need the revenues and purchases value. If you know margin and revenues, calculate Gross profit = Revenues × margin Then calculate cost of sales = Revenues- GP Then, closing inventory = opening inventory + purchases- cost of sales
Wow thanks mann
Good teaching but please lower the talking pace
wow. thx bro so much . this lesson keeps on bugging me. i subscribed and smashed the thumbs up
Glad it helped and thank you :)
Love from Bangladesh 🇧🇩 ❤
Thanks Sir
I like ur way of teaching.
Sir I have some doubt about... Is "Inventory overstated" & "Inventory Understated"--- "Inventory" refer to the opening stock or closing stock?
Closing I think
@@maya_008yea but depend on situation of the time, in current financial year it would acts like the goods unsold ( closing) then it was brought down to next financial year which was opening inventory
I am an oleveln student, are all the courses covered in this video according to caie syllabus?
Yes. but can be used by edexcel students also.
Thank you so much
Where are inventory T accounts covered
Not covered them yet it any video
god bless u fr
bro can you help me with a question that says it is estimated that half of the motor expenses related to miriam's personal use what should i do with this transaction pls help me
The half portion should be treated as drawings.
Why did we multiply the units with the selling price in first one and cost in the second one?
Becuase value inventory at lower of NRV (selling price in this case) or cost. In first one, SP < cost and in second one, Cost < SP. So choose the one which is lower.
Can you explain why the effect on next year cost of sale will be overstated if inventory is overstate
Because next year’s opening inventory will be overstated and that increases the cost of sales (because cost of sales = opening inventory + purchases - closing inventory)
sir if they ask us to value inventory, provided with opening inventory and the “margin” is 25% what is the formula to value the inventory?
U would also need the revenues and purchases value. If you know margin and revenues, calculate Gross profit = Revenues × margin
Then calculate cost of sales = Revenues- GP
Then, closing inventory = opening inventory + purchases- cost of sales
what would be the effect of incorrect valuation of inventory on equity?
Same effect as on the profit. If closing inventory is overvalued, equity will be overstated and vice versa.
Sir is this for O levels?
Yes.
Why are current assets not effected in the next year (11:41)
Because, current year's inventory is not considered in preparing the balance sheet of next year, so current assets of next year not affected.
Hello sir
I have some Doubt
yes you can comment here