CERTYNEX IFRS ACADEMY

The cheese maker Quérigny ripens its cheeses in a cellar; according to its process, ripening is a necessary stage of production, before the final packaging stage. Once packaged, the cheeses are kept in a refrigerated warehouse until they are sold. How should these two storage costs be treated?

Both costs are included, because they keep the cheeses in good condition.

Storage in the ripening cellar is included; storage after packaging is expensed.

Both costs are expensed, because a storage cost is never included in the cost of inventories, whatever its purpose.

Only storage after packaging is included, because it directly precedes the sale.