can we calculate the cost as per item category in case of firm having tax audit or whether it is mandatory to follow fifo method ?
like we have item of different size say LED therefore rates are also different. As a result FIFO is not possible to apply. In that case whether we can calculate the cost of stock according to item present at the end of financial year means we can differentiate the type of LED and then calculate the cost.
please reply whether is it correct?
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Inventory valuation
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AS - 2 issued by ICAI allows retails method for measurement of cost if he is a retailer whereby you can reduce the normal GP margin from selling price to arrive at cost. If specific identification can be done, then individual costs can be allocated to the cost. ICDS also allows both.
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