What do you reckon, should materials be written down if they\u2019re slow moving? The answer to this question isn\u2019t as black and white as you may think.<\/p>\n
When it comes to finished goods, the answer is more inclined towards \u201cyes\u201d since they\u2019re first off slow moving which indicates they\u2019re more likely to be sold lower their cost, and more so since they\u2019re finished items from raw materials. It\u2019s not that easy to use those goods for something else, i.e. scrap them to materials.\u00a0<\/p>\n
However, if you think about materials, those can be used for producing various things and hence they\u2019re market as it were is considerably larger than just those finished goods you\u2019re producing. As such, if your finished goods aren\u2019t selling all that good, there\u2019s still room to sell the materials to someone else with the price you bought them provided the market price for them hasn\u2019t dropped. If the case is so that the price is now lower, than yes, you will encounter a loss and as such, a write-down in value should be recognized, but not fully and right now.<\/p>\n
It\u2019s all depending on the amount you will be still using to produce your finished goods as opposed to the amount you\u2019ll be selling to someone else. It\u2019s also the matter of how much you\u2019re selling your finished goods below their cost; this should also be recognized as write-down in value for the materials.<\/p>\n","protected":false},"excerpt":{"rendered":"
What do you reckon, should materials be written down if they\u2019re slow moving? The answer to this question isn\u2019t as black and white as you may think. When it comes to finished goods, the answer is more inclined towards \u201cyes\u201d since they\u2019re first off slow moving which indicates they\u2019re more likely to be sold lower […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[31],"tags":[],"class_list":["post-4960","post","type-post","status-publish","format-standard","hentry","category-1-3-inventory"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.officetodo.com\/public\/wp-json\/wp\/v2\/posts\/4960","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.officetodo.com\/public\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.officetodo.com\/public\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.officetodo.com\/public\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.officetodo.com\/public\/wp-json\/wp\/v2\/comments?post=4960"}],"version-history":[{"count":1,"href":"https:\/\/www.officetodo.com\/public\/wp-json\/wp\/v2\/posts\/4960\/revisions"}],"predecessor-version":[{"id":4961,"href":"https:\/\/www.officetodo.com\/public\/wp-json\/wp\/v2\/posts\/4960\/revisions\/4961"}],"wp:attachment":[{"href":"https:\/\/www.officetodo.com\/public\/wp-json\/wp\/v2\/media?parent=4960"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.officetodo.com\/public\/wp-json\/wp\/v2\/categories?post=4960"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.officetodo.com\/public\/wp-json\/wp\/v2\/tags?post=4960"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}