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Valuation of Cost of Goods Sold & Inventory
CFA
answered on 09-Jul-25 11:08
We note that U.S. Regulatory body allows all methods of valuation of inventory. In that case whether the company has the opportunity to shift between methods of valuation based on the situations or if they adopt one particular methodology they are obliged to continue the same for the entire year to maintain consistency. If the above scenario is allowing to adopt all the methodology then Is it fair from tax perspective? Then how the government still not figuring this out to bring uniformity to collect tax properly.
latest answer
Hi Arun, When a company choose a particular inventory valuation method for US GAAP, it has to follow it consistently. If it wants to change its methodology, they have to disclose this in their notes to financial statement. From tax perspective, you are right in inferring that companies are freely allowed to switch freely they can opportunistically switch and reduce their tax outgo, to counter this for tax purpose, approvals from tax department is required for change in methodology with proper justification.
ARUN SKANDHAN SETHURAMAN
CA Inter
★ 120
1
133
TDS deuction on basic value of total Invoice Value
Indirect Taxation
answered on 22-Jul-25 11:21
Sir if the payment made is 5,90,000, which 5,00,000 + 90,000 GST Now TDS to be deducted on 5,90,000 or 5,00,000 [Video Time Stamp: 08:49]
latest answer
It’s part payment. It’s not mentioned it is including or excluding GST. That’s why TDS is done on entire amount
Hemachandra D
CA Final
★ 9K+
5
205
Depreciable amount
Accountancy
answered on 06-Jul-25 08:26
Depreciable amount=Acquisition cost - Residual value For example A firm purchased a machine worth ₹10 Lakhs The firm came to know that we will receive 2 lakhs as a residual value after 10 yrs And by which depreciable amount is 8 Lakhs We charged depreciation for 10 yrs at 10%pa In the 10th year when firm sold the machine firm realised 3 lakhs How firm should treat excess 1 lakh received on sales of machine [video Time Stamp: 05:54]
latest answer
Difference between carrying amount and sale proceeds is gain on sale. It is recognised in PL
Gurukanta Singh
CA Foundation
★ 19K+
1
175
Discharge of agreement by lapse of time
Corporate & Other Laws
answered on 09-Jul-25 12:51
In the video it has been said that there are different periods for different debt What are the different types of debt and their time period [video Time Stamp: 13:43]
latest answer
Yes
Gurukanta Singh
CA Foundation
★ 19K+
3
188
Financial Instrument - Off market terms
Financial Reporting
answered on 09-Jul-25 17:21
What will be the initial recognition value if issue price of the debenture is less than the fair value of debenture (PV of future CF discounted at market rate)?
latest answer
Thankyou sir
Durai Murugan
CA Final
★ 470
4
175
Exemption
Exams
answered on 05-Jul-25 17:17
I register for group 2 alone in September 2025 and get exemption in 2 subjects. Now in Jan 2026 shall I register for both groups and make use of the exemption ? Is the exemption valid ?
latest answer
Yes. Valid
Harish Chandar T
CA Inter
★ 5
1
199
Restoration of benefits under void agreement sec 55
Corporate & Other Laws
answered on 05-Jul-25 12:29
In the example of a family gathering where the husband and wife booked a caterer and a hotel for stay Due to certain circumstances the caterer and hotel management does not come up on that day The advance has been paid In such a case the token money is refunded or not if a contract is rescind by the caterer and hotel management [video Time Stamp: 10:59]
latest answer
If the caterer of the hotel rescinds the contract they will have to refund the amount. The forfeiture is in case where the couple cancels the contract. The caterer or hotel management will also be liable to pay additional compensation for cancellation from their side.
Gurukanta Singh
CA Foundation
★ 19K+
2
167
Leases
Accountancy
answered on 08-Jul-25 16:53
Sir, I have a doubt regarding whether initial direct costs and incentives which are incurred will be included in lease liability calculation or not as generally lease liability calculation involves future payments
latest answer
Initial direct cost is not part of liability. Incentives which are variable will be debited to P&L.
Manikyam
CA Final
★ 0
1
174
Turnover Limit on tobaco
Indirect Taxation
answered on 06-Jul-25 21:32
Sir whats the turnover limit for registration in case of supply of pan masala, tobaco......etc ?
latest answer
20L. 40L limit will not apply
Hemachandra D
CA Final
★ 9K+
1
183
Carrying Amount on 31/3/X3
Financial Reporting
answered on 09-Jul-25 16:44
Sir, why we take 4,70,000 instead of 4,60,000 as carrying amt as on 31.3.20X3. Total Impairment loss is Rs 60,000. Both the recoverable amount and Fair value less cost to sell are on the date of 31.3.20X3. [Video Time Stamp: 03:08]
latest answer
IF it is reclassified to not held for sale, we will compute depreciation assuming it was not held for sale.
Banu Priya
CA Final
★ 6K+
1
173