Normal and abnormal loss
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
26 February 2012
for instance 5000 units of input at 1000 per unit.normal loss =250 units.actual loss=300 units. so to compute cost of inventories is it correct that abnormal loss of 50 units at 1000 =50000 should be deducted from 50 lacs and then the remaining divided by 4700 to find cost i.e 50 lacs - 50000 divided by 4700
CA Himanshu Sharma
(Expert)
26 February 2012
yes for fair calculation u should do that.
SOURAV GOEL
(Expert)
27 February 2012
In order to comply with the requirements of AS-2 the effect of abnormal loss should be deducted from the Inventory.
In view of that, the treatment proposed by you is correct
In view of that, the treatment proposed by you is correct
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