CFAS PAS 2: Practical Applications and Principles
T or F: the use of LIFO is allowed under PAS2 - correct answer ✔✔False
T or F: biological assets and WIP under long-term contracts are within the scope of inventories - correct
answer ✔✔False
refers to the estimated selling price in the ordinary course of business LESS the estimated costs of
completion and the estimated costs necessary to make the sale - correct answer ✔✔NRV
T or F: inventories are assets held for sale in the ordinary course of business, process of production for
such sales, AND in the form of mats or supplies to be consumed in the production process or in the
rendering of services - correct answer ✔✔True
T or F: Inventories are measured at the lower of cost and NRV - correct answer ✔✔True
3 cost of inventories - correct answer ✔✔PCO
What comprises the cost of purchase of inventories? - correct answer ✔✔purchase, import duties,
transport, handling, trade discounts
T or F: Selling cost is part of the cost of inventories - correct answer ✔✔false, expense
T or F: Storage costs are excluded from the cost of inventories and are expense - correct answer
✔✔True, unless necessary sa production process
T or f; abnormal wastes are included in the cost of inventories - correct answer ✔✔False
T or F: Cost of conversion include DM, Dl, and MOH - correct answer ✔✔True
T or F: the use of LIFO is allowed under PAS2 - correct answer ✔✔False
T or F: biological assets and WIP under long-term contracts are within the scope of inventories - correct
answer ✔✔False
refers to the estimated selling price in the ordinary course of business LESS the estimated costs of
completion and the estimated costs necessary to make the sale - correct answer ✔✔NRV
T or F: inventories are assets held for sale in the ordinary course of business, process of production for
such sales, AND in the form of mats or supplies to be consumed in the production process or in the
rendering of services - correct answer ✔✔True
T or F: Inventories are measured at the lower of cost and NRV - correct answer ✔✔True
3 cost of inventories - correct answer ✔✔PCO
What comprises the cost of purchase of inventories? - correct answer ✔✔purchase, import duties,
transport, handling, trade discounts
T or F: Selling cost is part of the cost of inventories - correct answer ✔✔false, expense
T or F: Storage costs are excluded from the cost of inventories and are expense - correct answer
✔✔True, unless necessary sa production process
T or f; abnormal wastes are included in the cost of inventories - correct answer ✔✔False
T or F: Cost of conversion include DM, Dl, and MOH - correct answer ✔✔True
