INVENTRIES

Inventory
                 Inventries are the products that are purchase or produce for sale purpose.It also include the raw matrial that is purchase for production purpose.
Scope of inventry
                            IAS2 apply only on the products that are purchase for sale purpose and raw matrial for production purpose.
               sometime other section of IAS2 are apply i.e IAS11,IAS39,IAS41 etc.
Cost of inventories
                                All costs that are paid to take the goods into the godown i.e rent , labour, tax etc.Losses are not include into the inventory cost i.e abnormal loss, loss of inventory,forgien exchange difference etc.
Inventory system
                            There are two inventory systems that are used to record inventories.
1.priodic inventory system
2.perpatual inventory system
1.Periodic inventory system
                                               In periodic system when we purchase goods than debited the purchase account.
2.perpatual inventory system
                                               in perpatual system we debiteb the inventory account.
                                     Mathods to record inventories
 There are three mathods to record inventories
1.FIFO MATHOD
2.LIFO MATHOD
3.AVERAGE MATHOD