Day: August 11, 2026

Which ONE of the following constitute the best quality evidence concerning the net realisable value of inventory?

Select ONE answer:

1. Post year-end sales invoices
2. The company’s controls over inventory counting
3. Post year-end sales price list
4. Post year-end goods received notes

Show your workings to arrive at your answer, and explain and justify your reasons:

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This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 1

1. Correct – Post year-end sales invoices and sales orders. The controls over counting relate to existence, not valuation. A post year-end sales price list gives evidence of management intention in relation to inventory, but not evidence of the price that customers are genuinely prepared to pay (in the way that invoices and orders do).
2. Not correct
3. Not correct
4. Not correct

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