Hi,
The new FASB update to Inventory Topic 330 is revising the calculation of LCM lower of cost or market to LCNRV lower of cost or net realizable value. FASB defines NRV as the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation.
My questions lies with consumable supplies inventory that my company holds used for either internal use (mechanical maintenance) or for use in production, there is no selling price on the individual items. So can anyone clarify if this new FASB ruling is applicable to this type of inventory if selling prices cannot be reasonably determined?
The new FASB update to Inventory Topic 330 is revising the calculation of LCM lower of cost or market to LCNRV lower of cost or net realizable value. FASB defines NRV as the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation.
My questions lies with consumable supplies inventory that my company holds used for either internal use (mechanical maintenance) or for use in production, there is no selling price on the individual items. So can anyone clarify if this new FASB ruling is applicable to this type of inventory if selling prices cannot be reasonably determined?