Learning Module 6 of Financial Statement Analysis 11–14% of the exam
Analysis of Inventories
3 lessons. About 0 minutes in cram mode, 0 minutes in full.
Lessons for this module are being written. The outcomes and lesson plan below are final.
Lessons
- 1 Inventory Valuation
Coming soon
- 2 The Effects of Inflation and Deflation on Inventories, Costs of Sales, and Gross Margin
Coming soon
- 3 Presentation and Disclosure
Coming soon
What the exam expects you to do
- Describe the measurement of inventory at the lower of cost and net realisable value and its implications for financial statements and ratios.
- Calculate and explain how inflation and deflation of inventory costs affect the financial statements and ratios of companies that use different inventory valuation methods.
- Describe the presentation and disclosures relating to inventories and explain issues that analysts should consider when examining a company’s inventory disclosures and other sources of information.