The value of inventory is a difficult figure to pin down, and yet it must be properly derived in order to create accurate financial statements. TheAccounting for Inventorycourse enhances the accountant's ability to derive an accurate valuation, every time. It does so by delving into inventory counting systems, cost layering,standard costing, overhead allocation, the lower of cost or market rule, disclosures, measurements, and much more. This course is an essential tool for dealing with one of the largest and most complex assets on the balance sheet.
Learning Objectives
Upon successful completion of this course, participants will be able to:
Identify the types of inventory and recognize the timing of inventory ownership.
Specify the situations in which the periodic inventory system should be used, and how the perpetual system can be enhanced.
Identify the situations that can cause incorrect inventory transactions.
Recognize the activities needed to establish a system of inventory record keeping, and how such a system may be rendered less accurate.
Estimate ending inventory using the retail method.
Identify the contents and calculation methods used for all systems of cost layering.
Recognize the calculation methods for and causes of variances from standard costs.
Identify the accounting for and uses of a job costing system.
Specify the calculation methods and inputs needed to operate a process costing system.
Specify the contents of and controls over the use of overhead.
Identify who is responsible for spotting obsolete inventory, as well as the methods used to account for it.
Recognize the cost classifications used in the lower of cost or market rule.
Specify the accounting for spoilage, scrap, and rework.
Identify the methods of allocation for joint costs and by-products.
Recognize the disclosures associated with inventory.
Identify the contents of the various accounting entries needed to record inventory transactions.
Identify the rules promulgated by the Internal Revenue Service that relate to inventory.
Itemize the pricing methods that can be used to compile transfer prices between subsidiaries, as well as the issues associated with each one.
Identify the controls that can be used in the purchasing, receiving, and shipping of inventory.
Specify the kinds of inventory-related activities that can be fraudulently employed to alter financial results or steal assets.
Identify those policies that can be used to support accounting transactions related to inventory.
Recognize the calculation methods used for the various budgets that include inventory, as well as the issues to consider when constructing these budgets.
Specify how the results of various inventory measurements can be interpreted, when these measurements should be used, and the types of behavior they can reinforce.
Major Topics
Inventory
Periodic and Perpetual Inventory Systems
Inventory record Accuracy
Inventory Counting and Reconciliation
Estimating Ending Inventory
Inventory Cost Layering
Standard Costing Inventory
Job Costing
Process Costing
Overhead Allocation
Obsolete Inventory
Lower of Cost or Market Rule
Inventory Spoilage Rework, and Scrap
Joint and By-Product Costing
Inventory Disclosures
Inventory Transactions
Internal Revenue Code for Inventory
Inventory Transfer Pricing
Inventory Controls
Fraudulent Inventory Transactions
Inventory Policies
Inventory Budgeting
Inventory Measurements
