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Valuation of Material Receipts | Cost Accounting - B Com PDF Download

Following the procurement of materials from the supplier, the actual cost of the material is computed. The determination of the cost of purchased material is referred to as the valuation of material receipts. The cost of the material encompasses the purchase cost, adjusted for trade discounts, rebates, duty draw-back, input credit availed, etc., as well as other expenses incurred in transporting the inventories to their current location and condition.

Invoices for materials acquired from the market may include various items such as trade discount, quantity discount, freight, duty, insurance, cost of containers, taxes, cash discount, etc.

The handling of items related to the purchase of materials is outlined in the table below:

Valuation of Material Receipts | Cost Accounting - B Com

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