CERTYNEX IFRS ACADEMY

Kalimba, a manufacturer of seasonal toys, documents its method of allocating production overheads. Which statements comply with IAS 2?

Normal capacity is the maximum output the facilities could achieve if operated without any stoppage.

Normal capacity reflects the output an entity expects to achieve on average across several periods or seasons in normal conditions.

The loss of capacity resulting from planned maintenance is taken into account in determining normal capacity.

Actual output may be used when it is close to normal capacity.

When production is abnormally high, the fixed overhead per unit is increased.

Variable production overheads are allocated on the basis of normal capacity.