Inventories Research Essay

1. succinctIn this research, conference members atomic number 18 required to choose any guild from bursa Malaysia and determine or so their inventories, during this coursework, we mainly focus on the general study close inventories and the inventories of the company- Ajinamoto2. INTRODUCTIONInventories refer to a companys merchandise, gross materials, and finished and unfinished products which have not yet been sold. These atomic number 18 considered melted assets. There are various means of valuing these assets, but to be blimpish the lowest value is usually utilize in financial statements. The least common multiple rule is applied.3. CONTENT* Types of inventoriesThere are mainly 5 types of inventories for Ajinomoto afflictive materials (eg. stark(a) husk monosodium glutamate etc.) totalitying to RM34,445,868, consumables amounting to RM 4,536,693, work-in-progress amounting to RM2,374,316, and finished goods amounting RM21,445,751. These are the closing inventories for Ajinomoto* Manufacturing process.Ajinomoto uses green technology such as bio-cycle technology which improves amino acid, maximizing the usage of graphic resources, such as water and energy, the above diagram show the manufacturing process. The main raw materials are raw husk.* Valuation methodsAjinomoto uses weighted average method. Inventories are stated at the lower of greet and net realisable value. Cost incurred in bringing the inventories to their present location and condition are accounted for as follows * Raw materials purchase cost on a weighted average method. * washed-up goods and work-in-progess costs of direct materials and labour and a proportion of manufacturing overheads based on normal operating capacity.These costs are assigned on a weighted average method.Net realisable value is the estimated selling price in the ordinary course of business less estimated costs of completion and the estimated costs necessary to make the sale.* Amount of Closing Invento riesThe amount of closing inventories is RM 62,802,628. This piece of tail be acquired from the financial statement of Ajinamoto of year 20114. ADDITIONAL CONTENT* FIFO(First In First Out) is an asset-management and valuation method in which the assets acquired first are sold, used or disposed of first. FIFO may be used by an individual or a corporation. For taxation purposes, FIFO assumes that the assets that are remain in inventory are matched to the assets that are most recently purchased or produced.* Weighted Average Cost is a method of calculating closure Inventory cost. Inventory valuation method used where different quantities of goods are purchased at different unit costs. Under this method, weights are assigned to the cost price on the basis of the quantity of each item at each price. It is also known as AVCO It takes Cost of Goods Available for bargain and divides it by the total amount of goods from Beginning Inventory and Purchases.* Taxation is a means by which gov ernments finance their expenditure by imposing charges on citizens and corporate entities. Governments use taxation to encourage or discourage original economic decisions. For example, reduction in taxable personal (or household) income by the amount paid as interest on home mortgage loans results in greater construction activity, and generates more jobs.5. ConclusionAfter done this research, my group members and I increased our knowledge and comprehension about the companys annual report. This can help us more understand about the accounting for inventories. This are useful for us as a approaching accountants. We get more extra information that cant catch from the class. It also increase our leadership and communication skills with other group members. in like manner that, before start our assignment we also learn how to build up a group successfully. We put a lots of efforts and times in order to make this assignment more wonderful. We sincerely hoped that our efforts is worth ful.6. Referencehttp//www.ajinomoto.com/about/history/index.htmlhttp//www.ajinomoto.com/about/http//www.ajinomoto.com/ir/stock/info.htmlhttp//www.ajinomoto.com/ir/financial/financial_summary.html http//www.investorwords.com/2589/inventory.htmlhttp//www.businessdictionary.com/ explanation/taxation.htmlhttp//www.businessdictionary.com/definition/weighted-average-cost-of-inventory.html http//www.investopedia.com/terms/i/inventory.aspaxzz1fSj9WniT http//www.ehow.com/ehow_radlinks_ads.html?term=Inventory+Example& path=biz_business_management,text,suggested5&google_rt=ChBOiX2xAAdWbgriAMoOXR1TEhFJbnZlbnRvcnk http//www.agecon.purdue.edu/crd/localgov/Second%20Level%20pages/topic_inventory_tax.htm