Why do you think it’s important to have controls over inventory?
Inventory is related to your company’s operations. They are what you sell to generate revenues, they are your assets you sell regularly to earn profits. Note here that earning profits requires that your goods are priced accurately so as to cover for all kinds of expenses your company incurs. Continue reading
Regular monitoring of stock levels is essential for every business regardless of your production cycle, whether it’s a day or a month long. Continue reading
Certain types of goods require certain and sometimes strict storing requirements. I would assume that you’d already be knowledgeable of this when you started in your business, however it doesn’t hurt to repeat here some of the considerations. Not just that, but there are also types of goods that require to be transported by only certain means (certified carriers for fuels and so on) and only by defined types of carriers (consider this for say gas for instance, something with high temperature etc.) Continue reading
In your everyday business, in your everyday production you no doubt understand the need for certain levels of stock. You’ve got your orders coming in and as they come, you can see what you need more often and what’s left standing for a longer period than you’d expect. Those moving positions are what you need to keep up and make sure your positions meet the demand. Continue reading
Production is something many may want to get into, however when it comes to accounting, there are often times things that are overlooked. It’s not just that they are overlooked, but sometimes bluntly ignored. I want to make it clear why it’s important that your properly account for the cost of the items you produce – it directly impacts what you’ll be getting from the sale of the items. How are you about to determine sales prices for your items if you don’t exactly know the cost you must cover? Continue reading
As was defined before, the net realisable value is essentially an amount your company expects to realise from the sale of an inventory item in the ordinary course of business. First and foremost it should be noted that any rapid sales or forced sales (i.e. if the goods are seld to meet a warranted liability) are not defined as ‘ordinary course of business’ and prices determined under such conditions are normally not compared against cost of items of inventory. Continue reading
How would you define net realisable value (or NRV) for inventory items? International Accounting Standards define net realisable value as ‘the net amount that an entity expects to realise from the sale of inventory in the ordinary course of business’. Continue reading