While making adjustment to LIFO statements to derive FIFO COGS and inventory values, do we need to consider rising or declining prices? I haven't seen any examples of declining prices so kind of confused if we need to do this.作者: sdada 时间: 2011-7-13 16:14
This was covered extensively in the inventories chapter for last year but this year it isn't in the inventories reading at all. Instead there's just an example on it in a later reading. I really don't think you need to know it in too much detail.
FYI: As far as I can recall, if prices are falling the change in LIFO reserve in negative.作者: chetan86 时间: 2011-7-13 16:14
that's right, if prices are falling, change in LIFO reserve is negative. There were a lot of questions with either falling and rising prices of inventories in 2010 shwesser mocks.作者: btcapital 时间: 2011-7-13 16:14
Cinderella Wrote:
-------------------------------------------------------
> This was covered extensively in the inventories
> chapter for last year but this year it isn't in
> the inventories reading at all. Instead there's
> just an example on it in a later reading. I really
> don't think you need to know it in too much
> detail.
>
> FYI: As far as I can recall, if prices are falling
> the change in LIFO reserve in negative.
I am not sure if I need to worry about this one but definitely if schweser mock or Q bank cover this I won't overlook this either. There are many questions on Qbank and mock. I have seen with price rising and price declining as well. But not sure how to treat them.作者: JGovender 时间: 2011-7-13 16:14
I am on Reading 38 right now, and can confirm what Cinderella said - reserves, in general, haven't been covered in that much detail yet (not even in the chapter on Inventories).
My guess, from what I have seen thus far, is that they moved all the allowance-related topics (bad debt, inventory reserves, etc.) to Level II!?
