In Stock Valuation, the principle at cost price or Market Price whichever is lower will result in the valuation of stock sometimes at cost price and at other times at Market Price. This is an application of the principle of -
AConsistency
BMateriality
CConservatism
DDisclosure
Question - 2
A minimum quantity of stock always held as precaution against out of stock situation is called _____
AZero stock
BRisk stock
CBase stock
DNone of the above
Question - 3
Closing stock is valued at
AMarket price
BCost price
CCost price or market price whichever is lower
DCost price or market price whichever is higher
Question - 4
When inventory declines in value below original (historical) cost, and this decline is considered other than temporary, what is the maximum amount that the inventory can be valued at?
ASales price net of conversion costs
BNet realizable value
CHistorical cost
DNet realizable value reduced by normal profit margin.
Question - 5
By products are generally valued at ____ when the cost of by products is not directlytraceable.
ACost of main products
BN.R.V.
CCost of main product or N.R.V. whichever is lower
DNone of these
Question - 6
Net realizable value is ______
AEstimated Selling Price
BEstimated Cost Price plus Marketing Cost
CEstimated Selling Price less Cost incurred in order to make sale
DEstimated Selling Price plus cost incurred in order to make sale
Question - 7
Which of the following is not a part of inventory?
AFinished goods
BRawmaterial, Components, Consumables& Supplies
CSpare parts of Plant and Machinery
DWork-In-Progress
Question - 8
Inventory valuation method is guided by which of the following accounting concept
ABusiness entity
BConservatism
CMateriality
DDouble entry
Question - 9
Which is not an objective of inventory valuation?
ATo determine true profit and loss
BTo show true financial position of the business
CTo properly value closing stock
DTo evade tax liability
Question - 10
Which Cost is not considered as cost of inventory?