14 July 2013
The basic principal of stock valuation is that you take the physical stock on the end of the financial year and then value the same at cost or market value whichever is lower. If the NRV is lower then the cost then it is to be taken at NRV. Once you value the stock and take into the accounts automatically the same will be shown at deduction in value as you are not taking cost and then deducting the lower value as comared to market. Hence this theory of cost or market is automatically taken into consideration.
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