4. You are required to prepare a Selling Overhead Budget from the estimates given below (amount in Lakhs): Advertisement Rs.1,000 Salaries of the Sales Dept. Rs. 1,000 Expenses of the Sales Dept. (Fixed) Rs.750 Salesmen's remuneration Rs. 3,000 Salesmen's Dearness Allowance - Commission @ 1% on sales affected Carriage Outwards: Estimated @ 5% on sales Agents Commission: 7%2% on sales The sales during the period were estimated as follows: (a) Rs.80,000 including Agent's Sales Rs.8,000 (b) Rs.90,000 including Agent's Sales Rs.10,000 (c) Rs.1,00.000 including Agent's Sales Rs.10,500

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Inventory Valuation

Before discussing the topic inventory valuation let’s discuss the meaning of inventory. In accounting, inventory is also known as stock. Inventory means all the finished goods, materials, merchandise that a business holds for the purpose of selling it in the market with the motive of earning profit.