Year End 2016 (Ghs) 2017 (Ghs) 2018 (Ghs) Cost of sales 830,000 904,000 968,000 Profit after tax 50,000 80,000 105,000 Inventory valuation: Weighted Average 275,000 257,000 304,000 FIFO 296,000 294,000 365,000 Requirement Based on the information provided, show how the change in inventory valuation method will be reflected in the financial statements of R Limited for the year ended 31 December 2018.
R Limited has traditionally valued its inventory using the weighted average method of valuation. During the year ended 31 December 2018, the directors of R Limited decided to change the method of
The reported
|
Year End |
2016 (Ghs) |
2017 (Ghs) |
2018 (Ghs) |
|
Cost of sales |
830,000 |
904,000 |
968,000 |
|
Profit after tax |
50,000 |
80,000 |
105,000 |
|
Inventory valuation: Weighted Average |
275,000 |
257,000 |
304,000 |
|
FIFO |
296,000 |
294,000 |
365,000 |
Requirement
Based on the information provided, show how the change in inventory valuation method will be reflected in the financial statements of R Limited for the year ended 31 December 2018.
Step by step
Solved in 2 steps
