CERTYNEX IFRS ACADEMY

Why is specific identification inappropriate for an inventory comprising a large number of items that are ordinarily interchangeable?

Because it is reserved for goods produced by the entity and prohibited for goods bought from third parties.

Because it always leads to a cost higher than the net realisable value of the items concerned.

Because the choice of the items remaining in inventory could be used to influence profit or loss.

Because the standard always requires FIFO, the only cost formula permitted for those items.