IAS 2Chapter 4Lesson 1
Costs of purchase
Step 1 of 9Learning objectives
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What goes into the cost of purchased inventory: the purchase price less discounts and rebates, import duties and non-recoverable taxes, transport, handling and other directly attributable costs; what is excluded: recoverable taxes and costs incurred after the item has reached its intended location and condition.
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Learning objectives
- Place costs of purchase among the three components of the cost of inventories.
- Identify the items to include in, deduct from and exclude from costs of purchase.
- Calculate the cost of purchase and the unit cost of a batch from an invoice and its related costs.
- Record the entry of a purchase into inventory.