Ad Free CAclubindia and Daily Updates on your Mobile. Subscribe Now!

Production at Sales Value?

C.A.Ravi Kiran (Consultant) (72 Points)

15 November 2008

Frnds.,

Do u think ., (Sales) +/- (Difference in Finished Goods / WIP) = Production at sales value ?

If not ., what is it ? ? ?

Reply
Follow
Share

4 Replies

Ruchika Gupta (Chartered Accountant) (247 Points)
Replied 16 November 2008

U have not mentioned that at what price u have valued the difference in finished goods or WIP.

Upgrade to CAclubindia Pro. Subscribe Now!

C.A.Ravi Kiran (Consultant) (72 Points)
Replied 16 November 2008

Originally posted by :Ruchika Gupta
"	U have not mentioned that at what price u have valued the difference in finished goods or WIP.	"

FG n WIP are valued at Cost .... < obviously > .,

Soo., shud i increase the FG n WIP by the Gross Margin to arrive @ Production at Sales Value ?

Ruchika Gupta (Chartered Accountant) (247 Points)
Replied 19 November 2008

I think so, b'oz if u 've valued the finished goods/WIP @ cost price then the basis won't be uniform to arrive at a figure. If the aforesaid variables were in terms of quantity only (and not in monetary terms) then the equation would give the figure of quantity produced. But if u want to find out the production figure in monetary terms then u have to use the same base for all variables of the aforesaid equation i.e either the sales price (which would give PRODUCTION AT SALES VALUE) or at cost of production (which would give PRODUCTION AT COST).

C.A.Ravi Kiran (Consultant) (72 Points)
Replied 19 November 2008

Originally posted by :Ruchika Gupta
"	I think so, b'oz if u 've valued the finished goods/WIP @ cost price then the basis won't be uniform to arrive at a figure. If the aforesaid variables were in terms of quantity only (and not in monetary terms) then the equation would give the figure of quantity produced. But if u want to find out the production figure in monetary terms then u have to use the same base for all variables of the aforesaid equation i.e either the sales price (which would give PRODUCTION AT SALES VALUE) or at cost of production (which would give PRODUCTION AT COST).	"

Heei tnks a lot

evn i thot d same rey