a) Recognise the need for adjustments for inventory in preparing financial statements.
b) Record opening and closing inventory.
c) Identify the alternative methods of valuing inventory.
d) Understand and apply the IASB requirements for valuing inventories.
e) Recognise which costs should be included in valuing inventories.
f) Understand the use of continuous and period end inventory records.
g) Calculate the value of closing inventory using FIFO (first in, first out) and AVCO (average cost) – both periodic weighted average and continuous weighted average.
h) Understand the impact of accounting concepts on the valuation of inventory.
i) Identify the impact of inventory valuation methods on profit and on assets.