1 / 7

CURRENT ASSETS

CURRENT ASSETS. STOCKS VALUATION INVESTMENTS. Stocks Valuation: Concepts (I). Stocks are CA Why valuation ? Stocks were bought at different prices Affects: Closing Stocks Value COGS in Trading Account GP , NP CA in Balance Sheet Total Assets Value. Valuation Methods. FIFO

adsila
Download Presentation

CURRENT ASSETS

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. CURRENT ASSETS • STOCKS VALUATION • INVESTMENTS

  2. Stocks Valuation: Concepts (I) • Stocks are CA • Why valuation? • Stocks were bought at different prices • Affects: • Closing Stocks Value • COGS in Trading Account • GP, NP • CA in Balance Sheet • Total Assets Value

  3. Valuation Methods FIFO • 1st bought is the 1st to be sold LIFO • Last bought is the 1st to be sold AVCO • Average between 1st & Last

  4. Impact of Price Movement Highest CS Lowest COGS ↑GP/NP ↑CA Lowest CS Highest COGS ↓GP/NP ↓ CA In the middle since average In the middle since average The reverse of the above The reverse of the above Since the cheapest are charged out 1st

  5. Impact of Under/Over Valued ↑ ↓ ↓ ↓ The reverse

  6. Stocks Valuation: Concepts (II) • General rule of: “LOWER OF COST & NET REALISABLE VALUE” • NRV: Selling Price – Selling costs

  7. REPORTING BALANCE SHEET AS AT ……. FIXED ASSETS CURRENT LIABILITIES INVESTMENTS ASSETS LONG-TERM LIABILITIES EQUITY INTERESTS CURRENT ASSETS

More Related