Series 2, Episode 6 - Inventory Valuation – FIFO, AVCO & IAS 2

What this episode covers

In this episode of Debit, Credit, Done! we’re tackling inventory valuation — a key area of the AAT Level 3 Financial Accounting: Preparing Financial Statements module.We’ll cover:Why accurate inventory valuation matters for profit and assetsIAS 2 rules: lower of cost and net realisable value (NRV)FIFO (First-In, First-Out) explained with examplesAVCO (Average Cost) worked through step by stepHow to apply NRV adjustments when values fallA full worked example combining purchases, sales, and NRVYou’ll also get AAT exam tips on spotting NRV adjustments, showing full workings, and avoiding common traps.🎙 Challenge: Try the FIFO example at the end of the episode to check your understanding before Monday’s release!

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