Original cost $210

Estimated selling price   $225

Estimated selling costs  $22

Net realizable value       $203

Replacement cost         $197

Normal profit margin     $12

Under IFRS,the inventory is written down to the net realizable value of $203 and a $7 loss is reported in the income statement.

Under U.S. GAAP,the inventory is written down to $197 and a $13 loss is reported in the income statement.

这里比较好理解，题目里面又提到：

Assume that in the year after the writedown in the previous example,net realizale value and replacement cost both increase by $10.What is the impact of the recovery under IFRS and under U.S. GAAP?

Under IFRS,it will write up inventory to $210 per unit and recognize a $7 gain in its income statement.

IFRS,是按照NRV和cost比较的，这里的 $7 gain是怎么算出来的？

Under U.S. GAAP，no write-up is allowed.The per-unit carrying value will remain at $197.

replacement cost increased by $10,就应该是 $207，这个时候比 original cost 低，应该记 $207 不是吗？为什么是 remain at $197 呢？

Thank you～～～～～

IFRS里面可以记recovery，但是仅仅是recovery，不能高于原来的cost。

USGAAP不允许记recovery，也就是说账面价值只能往下走，不能还原。

呵呵~

楼上的两位是热心的。

嗯，这世上还是好人多嘛。