(a) Villandry's inventory includes three items for which the following details are available.
|
|
Supplier's
|
Net realisable
|
|
list price
|
value
|
|
$
|
$
|
|
Product A
|
3,600
|
5,100
|
|
Product B
|
2,900
|
2,800
|
|
Product C
|
4,200
|
4,100
|
The company receives a 2½% trade discount from its suppliers and it also takes advantage of a 2% discount for prompt payment.
Required
Calculate the total value of products A, B and C which should be shown in inventory in the statement of financial position.
Explain the difference that changing from a weighted average to FIFO method of inventory valuation is likely to have on profit or loss.