Calculating the Cost of a Sales ReturnWatch
I've been trying to figure out how exactly a business goes about calculating the value of a sales return once the inventories go back into the pool of available stock.
For the FIFO approach I read that the cost of the units returned is based upon the most recent value of COGS at the date in which the items were sold, but the information came from Australian Accounting Standards, and I'm studying under IAS.
Is there any particular principle which covers how a business using either the perpetual or periodic inventory method can value the inventories that have just come back into a business, be it through FIFO or AVCO (and LIFO for explanatory purposes).
Thanks in advance.
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