Inventive Controls Ltd. was incorporated and started business early in January 2012 to manufacture electronic control devices to monitor traffic. Inventive purchased a small manufacturing plant and office building in a new industrial park and was in operation immediately. General ledger account balances at December 31, 2012 are as follows:
At December 31, 2012, there was no work-in-process, but 30% of the units manufactured remained in ending finished goods inventory. Inventive uses the straight-line method to calculate depreciation.
Required:
a. Calculate the value of cost of goods sold and ending finished goods inventory under IFRS.
b. Prepare an income statement for Inventive for the year ended December 31, 2012.

Question

Inventive Controls Ltd. was incorporated and started business early in January 2012 to manufacture electronic control devices to monitor traffic. Inventive purchased a small manufacturing plant and office building in a new industrial park and was in operation immediately. General ledger account balances at December 31, 2012 are as follows:
  At December 31, 2012, there was no work-in-process, but 30% of the units manufactured remained in ending finished goods inventory. Inventive uses the straight-line method to calculate depreciation.
Required:
a. Calculate the value of cost of goods sold and ending finished goods inventory under IFRS.
b. Prepare an income statement for Inventive for the year ended December 31, 2012.

Quizplus · Accepted Answer

The Answer of Inventive Controls Ltd. was incorporated and started business early in January 2012 to manufacture electronic control devices to monitor traffic. Inventive purchased a small manufacturing plant and office building in a new industrial park and was in operation immediately. General ledger account balances at December 31, 2012 are as follows:
  At December 31, 2012, there was no work-in-process, but 30% of the units manufactured remained in ending finished goods inventory. Inventive uses the straight-line method to calculate depreciation.
Required:
a. Calculate the value of cost of goods sold and ending finished goods inventory under IFRS.
b. Prepare an income statement for Inventive for the year ended December 31, 2012.