Anil (1638 Points)
09 June 2008In a product based software industry once the product is manufactured it becomes stock. Does stock value goes on multiplying as one goes on taking copies of the product on some media?If answer to the above is YES , then the software companies can easily inflate their profits just by taking copies of software already manufactured which do not take significant effort or time. Does this seem prudent?
Vinod Kashyap
(XBRL Training)
(451 Points)
Replied 09 June 2008
No, the value of stocks doesn't multiply by just making copies of the software on CD or other media. The valuation is done on the basis of 'Cost or Market Value whichever is Less'.
Anil
(1638 Points)
Replied 09 June 2008
Thanks for the reply. Please let me know when does the stock get exhausted? I am asking this because one always sells after making copy of original software manufactured and original software manufactured remains with the company.
CAclubindia
