The ending inventory
levels clocked in at 382,000 tonnes, up 4.4pc YoY.
Sugar sector has witnessed sizeable increase in ending inventory
over the last two years.
However, overall surplus inventories are expected to persist (even after accounting for strategic reserves) for the sugar sector given significant ending inventory
at end of financial year 2017-18.
The final regulations detail the proper calculation of ending inventory
values under the retail-inventory method, and provide alternative calculation methods for taxpayers using the retail-lower-of-cost-or-market (retail-LCM) method of accounting to account for margin protection payments.
This month we will outline a plan for creating the next four queries and then complete the first one, Desired Ending Inventory
The lower the cost of ending inventory
, the higher is the cost of goods sold, and vice versa.
But to get the correct purchases amount, you must add the value of starting inventory and subtract the value of ending inventory
. Say you purchased 10 special-order windows for $300 each.
"Well, if the ending inventory
is correct, then we need to look at what the client is paying to manufacture cement.
We assume a LIFO cost flow to determine cost of goods sold and to value ending inventory
. For consistency and comparability with later analysis, we assume that the units in the beginning inventory are valued using an overhead rate of $16 per direct labor hour, which represents budgeted fixed overhead of $480,000 divided by the practical capacity of 30,000 direct labor hours.
Using the base-year approach, ending inventory
and all previously existing inventory layers are converted to amounts based upon a base-year price level.