# ASC Topic 330: Inventory Source: FASB Accounting Standards Codification, Basic View [Read online](https://asc.understandingaccounting.org/asc/330/) Study and research edition. Verify current requirements with the official source. Summaries, enrichment, and tags are machine-generated study aids. Paragraph html preserves source markup; snippet is abbreviated. Pending content is not necessarily effective. Tables and mathematical or amendment markup are retained as HTML where Markdown would lose structure. Source downloaded (UTC): 2026-09-09T23:50:30.404Z to 2026-09-09T23:54:12.400Z Record version: sha256:e92d9797660f12362cc07b73a1405b36484a12e967af893fa1bc663c71879efe Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## Machine-generated topic summary ASC 330 establishes that inventory is initially measured at cost — all direct and indirect expenditures incurred to bring an article to its existing condition and location — with fixed overhead allocated on normal capacity and abnormal freight, handling, spoilage, and idle-capacity overhead expensed as period charges (330-10-30-1 through 30-8). Cost may be assigned using FIFO, average cost, LIFO, standard cost, or the retail inventory method, applied consistently to most clearly reflect periodic income; subsequent measurement is bifurcated, with LIFO and retail-method inventory subject to lower of cost or market (replacement cost capped at NRV and floored at NRV less normal profit) and all other inventory measured at lower of cost and net realizable value, a write-down creating a new cost basis that cannot be reversed (330-10-35-1B through 35-14). Industry subtopics tailor these rules: agriculture (330-905) accumulates growing-crop costs to harvest and permits NRV/market valuation for readily marketable products; mining (330-930) treats production-phase stripping costs as variable production costs of the ore extracted; airlines (330-908) carry expendable parts at cost with an obsolescence allowance; software (330-985), films (330-926), time-shares (330-978, relative sales value method), oil and gas (330-932), government contractors (330-912), and retail land (330-976) add narrow recognition, measurement, or disclosure rules, while construction contractor guidance (330-910) is fully superseded. The unifying idea is that inventory is carried at cost until cost exceeds the value recoverable through sale, at which point the loss is recognized immediately. Source downloaded (UTC): 2026-09-09T23:50:30.404Z to 2026-09-09T23:51:21.227Z Record version: sha256:c39df8b09e7d239709f3e2e448c6996d08038409e2a8159a4dc8b5749424c313 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-10: Inventory — Overall ### Machine-generated study aids ```json { "summary": "ASC 330-10 governs the accounting for inventory: inventory is initially measured at cost (all expenditures and charges, direct and indirect, incurred to bring an article to its existing condition and location), with fixed production overhead allocated based on normal capacity and unallocated overhead, abnormal freight, handling, and spoilage expensed as incurred. Cost may be assigned using FIFO, average cost, LIFO, standard cost, or the retail inventory method, chosen to most clearly reflect periodic income and applied consistently. Subsequent measurement is bifurcated: inventory measured under LIFO or the retail inventory method uses lower of cost or market, while all other inventory (FIFO, average cost) uses lower of cost and net realizable value.", "key_points": [ "Inventory's primary basis of accounting is cost — the sum of applicable expenditures and charges directly or indirectly incurred in bringing an article to its existing condition and location (330-10-30-1).", "Fixed production overhead is allocated based on the normal capacity of production facilities; the per-unit allocation may not be increased because of abnormally low production or idle plant, and unallocated overheads are expensed in the period incurred (330-10-30-6 through 30-7).", "Abnormal freight, handling costs, spoilage, general and administrative expenses (except portions clearly related to production), and all selling expenses are period charges, not inventory costs (330-10-30-7 through 30-8).", "Cost flow assumptions (FIFO, average, LIFO), standard costs adjusted at reasonable intervals, and the retail inventory method are all acceptable; the method chosen should most clearly reflect periodic income and be applied consistently (330-10-30-9, 30-12, 30-15).", "Inventory measured using any method other than LIFO or the retail inventory method is measured at the lower of cost and net realizable value, with any excess of cost recognized as a loss in earnings in the period it occurs (330-10-35-1B).", "Inventory measured using LIFO or the retail inventory method is subject to the lower of cost or market rule, where market is generally current replacement cost but is capped at net realizable value and floored by NRV less a normal profit margin — no loss is recognized if cost will be recovered with an approximately normal profit (330-10-35-1C through 35-5).", "A write-down establishes a new cost basis that may not be reversed (330-10-35-14); net losses on firm, uncancelable, unhedged purchase commitments must be accrued and disclosed separately in the income statement (330-10-35-17, 330-10-50-5); inventory may be stated above cost only in exceptional cases such as precious metals with a government-controlled fixed market or certain interchangeable agricultural and mineral products (330-10-35-15 through 35-16)." ], "categories": [ "Inventory and PP&E", "Initial measurement", "Subsequent measurement", "Impairment" ], "audience_level": "introductory", "student_note": "The most tested trap is the post-ASU 2015-11 split: LIFO and retail-method inventories still use \"lower of cost or market\" (with the replacement-cost ceiling/floor analysis), while FIFO and average-cost inventories use the simpler \"lower of cost and net realizable value.\" Also remember that a write-down creates a new cost basis — under U.S. GAAP it is not reversed if value recovers (330-10-35-14).", "related_topics": [ "270-10", "340-40", "705-20", "845-10", "815-25", "250-10" ], "key_concepts": [ "inventory cost", "normal capacity", "fixed production overhead allocation", "lower of cost and net realizable value", "lower of cost or market", "cost flow assumptions (fifo, lifo, average)", "retail inventory method", "firm purchase commitment losses" ] } ``` Source downloaded (UTC): 2026-09-09T23:50:30.404Z to 2026-09-09T23:50:30.404Z Record version: sha256:c4a35cd99d4bf1b1c39309798c334171579228515b05af3f998e2317eae5b346 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-10-00: 00 Status [Read section](https://asc.understandingaccounting.org/asc/330/10/#00-status) SEC content: no ##### [330-10-00-1](https://asc.understandingaccounting.org/asc/330/10/#330-10-00-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:30.404Z to 2026-09-09T23:50:30.404Z Record version: sha256:720c759f009e8a658b95e192e420925904d005a6a852b185ec600570ba50daf5 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The following table identifies the changes made to this Subtopic.
ParagraphActionAccounting Standards UpdateDate
CustomerAddedAccounting Standards Update No. 2014-0905/28/2014
Direct Effects of a Change in Accounting PrincipleAmendedAccounting Standards Update No. 2015-1107/22/2015
Market (2nd def.)AmendedAccounting Standards Update No. 2014-0603/14/2014
Net Realizable Value (1st def.)SupersededAccounting Standards Update No. 2014-0603/14/2014
Net Realizable Value (2nd def.)AddedAccounting Standards Update No. 2014-0603/14/2014
Public Business EntityAmendedMaintenance Update 2017-06 (PDF)04/07/2017
Public Business EntityAmendedMaintenance Update 2016-11 (PDF)06/27/2016
Reseller (2nd def.)AddedAccounting Standards Update No. 2014-0905/28/2014
VendorAddedAccounting Standards Update No. 2014-0905/28/2014
330-10-30-8AmendedAccounting Standards Update No. 2014-0905/28/2014
330-10-30-19SupersededAccounting Standards Update No. 2014-0905/28/2014
330-10-30-20AddedAccounting Standards Update No. 2014-0905/28/2014
330-10-30-21AddedAccounting Standards Update No. 2014-0905/28/2014
330-10-35-1SupersededAccounting Standards Update No. 2015-1107/22/2015
330-10-35-1A through 35-1C
AddedAccounting Standards Update No. 2015-1107/22/2015
330-10-35-2AmendedAccounting Standards Update No. 2015-1107/22/2015
330-10-35-6SupersededAccounting Standards Update No. 2015-1107/22/2015
330-10-35-7AAddedAccounting Standards Update No. 2015-1107/22/2015
330-10-35-8 through 35-11
AmendedAccounting Standards Update No. 2015-1107/22/2015
330-10-35-21AmendedAccounting Standards Update No. 2014-0905/28/2014
330-10-35-22AmendedAccounting Standards Update No. 2014-0905/28/2014
330-10-45-2SupersededAccounting Standards Update No. 2014-0905/28/2014
330-10-50-1AmendedAccounting Standards Update No. 2012-0410/01/2012
330-10-50-2AmendedAccounting Standards Update No. 2015-1107/22/2015
330-10-50-5AmendedAccounting Standards Update No. 2024-0311/04/2024
330-10-55-2AmendedAccounting Standards Update No. 2015-1107/22/2015
330-10-55-5 through 55-7
SupersededAccounting Standards Update No. 2017-0703/10/2017
330-10-55-6AAddedAccounting Standards Update No. 2017-0703/10/2017
330-10-65-1AddedAccounting Standards Update No. 2015-1107/22/2015
Source downloaded (UTC): 2026-09-09T23:50:33.473Z to 2026-09-09T23:50:33.473Z Record version: sha256:4ea5a29600c4bf811550f5cae39d34a747789dc6f24ab94b3a316c985ce777ac Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-10-05: 05 Overview and Background [Read section](https://asc.understandingaccounting.org/asc/330/10/#05-overview-and-background) SEC content: no ##### [330-10-05-1](https://asc.understandingaccounting.org/asc/330/10/#330-10-05-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:33.473Z to 2026-09-09T23:50:33.473Z Record version: sha256:2afb66158d4769376dc28675553524bc3284a289287ba0ed3e1db479bb98a919 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The [Inventory](https://asc.understandingaccounting.org/glossary/i/#inventory "The aggregate of those items of tangible personal property that have any of the following characteristics: Held for sale in the ordinary course of business In process of production for such sale To be currently consumed in the production of goods or services to be available for sale. The term inventory embraces goods awaiting sale (the merchandise of a trading concern and the finished goods of a manufacturer), goods in the course of production (work in process), and goods to be consumed directly or indirectly in production (raw materials and supplies). This definition of inventories excludes long-term assets subject to depreciation accounting, or goods which, when put into use, will be so classified. The fact that a depreciable asset is retired from regular use and held for sale does not indicate that the item should be classified as part of the inventory. Raw materials and supplies purchased for production may be used or consumed for the construction of long-term assets or other purposes not related to production, but the fact that inventory items representing a small portion of the total may not be absorbed ultimately in the production process does not require separate classification. By trade practice, operating materials and supplies of certain types of entities such as oil producers are usually treated as inventory.") Topic addresses the accounting principles and reporting practices applicable to inventory. ##### [330-10-05-2](https://asc.understandingaccounting.org/asc/330/10/#330-10-05-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:33.473Z to 2026-09-09T23:50:33.473Z Record version: sha256:44e3889cde55ee061c5ba4d1cbccb1f6c90ecd6f0a102117a3d80b3e69260d17 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. An inventory has financial significance because revenues may be obtained from its sale, or from the sale of the goods or services in the production of which it is used. Normally such revenues arise in a continuous repetitive process or cycle of operations in which goods are acquired, created, and sold, and further goods are acquired for additional sales. ##### [330-10-05-3](https://asc.understandingaccounting.org/asc/330/10/#330-10-05-3) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:33.473Z to 2026-09-09T23:50:33.473Z Record version: sha256:0a6aefeaec25660a3bda5e42ab9594053159c29f5692415817490f80327cf91c Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Thus, the inventory at any given date is the balance of costs applicable to goods on hand remaining after the matching of absorbed costs with concurrent revenues. This balance is appropriately carried to future periods provided it does not exceed an amount properly chargeable against the revenues expected to be obtained from ultimate disposition of the goods carried forward. In practice, this balance is determined by the process of pricing the articles included in the inventory. Source downloaded (UTC): 2026-09-09T23:50:35.647Z to 2026-09-09T23:50:35.647Z Record version: sha256:bb5b9f36f4b4e3f319dd18ad7d92abd8b5b1a273864545d905e4dbbc4d79a2ab Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-10-10: 10 Objectives [Read section](https://asc.understandingaccounting.org/asc/330/10/#10-objectives) SEC content: no ##### [330-10-10-1](https://asc.understandingaccounting.org/asc/330/10/#330-10-10-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:35.647Z to 2026-09-09T23:50:35.647Z Record version: sha256:c13291aa10001aac803051bd65fcb11830453c0cbe25d53e360018813b496c96 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A major objective of accounting for inventories is the proper determination of income through the process of matching appropriate costs against revenues. Source downloaded (UTC): 2026-09-09T23:50:38.796Z to 2026-09-09T23:50:38.796Z Record version: sha256:4badf5ea554d9de88b169f70e7a7f485a035061a5f4a1aa25aa48a3597134c57 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-10-15: 15 Scope and Scope Exceptions [Read section](https://asc.understandingaccounting.org/asc/330/10/#15-scope-and-scope-exceptions) SEC content: no #### Overall Guidance ##### [330-10-15-1](https://asc.understandingaccounting.org/asc/330/10/#330-10-15-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:38.796Z to 2026-09-09T23:50:38.796Z Record version: sha256:9c1178cfb0beefe98d3785c0d02a08407c75934b3a053819f5a2570f480fcb73 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The Scope Section of the Overall Subtopic establishes the pervasive scope for the [Inventory](https://asc.understandingaccounting.org/glossary/i/#inventory "The aggregate of those items of tangible personal property that have any of the following characteristics: Held for sale in the ordinary course of business In process of production for such sale To be currently consumed in the production of goods or services to be available for sale. The term inventory embraces goods awaiting sale (the merchandise of a trading concern and the finished goods of a manufacturer), goods in the course of production (work in process), and goods to be consumed directly or indirectly in production (raw materials and supplies). This definition of inventories excludes long-term assets subject to depreciation accounting, or goods which, when put into use, will be so classified. The fact that a depreciable asset is retired from regular use and held for sale does not indicate that the item should be classified as part of the inventory. Raw materials and supplies purchased for production may be used or consumed for the construction of long-term assets or other purposes not related to production, but the fact that inventory items representing a small portion of the total may not be absorbed ultimately in the production process does not require separate classification. By trade practice, operating materials and supplies of certain types of entities such as oil producers are usually treated as inventory.") Topic. #### Entities ##### [330-10-15-2](https://asc.understandingaccounting.org/asc/330/10/#330-10-15-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:38.796Z to 2026-09-09T23:50:38.796Z Record version: sha256:5d07dfb2c0f9635a18c8243c210ce2e68ce4418e50f6d902e015315d27bf5ca3 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The guidance in the Inventory Topic applies to all entities, with the following qualifications. ##### [330-10-15-3](https://asc.understandingaccounting.org/asc/330/10/#330-10-15-3) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:38.796Z to 2026-09-09T23:50:38.796Z Record version: sha256:50da4421631e7e4ce16d4977f70b8b00ad332092f6890371ddea9203f3e68630 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The guidance in this Topic is not necessarily applicable to the following entities: 1. a Not-for-profit entities (NFPs) 2. b Regulated utilities. Source downloaded (UTC): 2026-09-09T23:50:46.569Z to 2026-09-09T23:50:46.569Z Record version: sha256:6e675c2187973b40e1548f7da8063eeb75a3a9447ee857a6040300fe9ff3a813 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-10-30: 30 Initial Measurement [Read section](https://asc.understandingaccounting.org/asc/330/10/#30-initial-measurement) SEC content: no #### Cost Basis ##### [330-10-30-1](https://asc.understandingaccounting.org/asc/330/10/#330-10-30-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:46.569Z to 2026-09-09T23:50:46.569Z Record version: sha256:b8ef44a573cdf88501800f0eb7325413ad6993b8d054255a1f3e92370da1a6f9 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The primary basis of accounting for inventories is cost, which has been defined generally as the price paid or consideration given to acquire an asset. As applied to inventories, cost means in principle the sum of the applicable expenditures and charges directly or indirectly incurred in bringing an article to its existing condition and location. It is understood to mean acquisition and production cost, and its determination involves many considerations. ##### [330-10-30-2](https://asc.understandingaccounting.org/asc/330/10/#330-10-30-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:46.569Z to 2026-09-09T23:50:46.569Z Record version: sha256:1570c59aee9618e7bd4c1119ac659805cfb36e7b6d0b456c6e8b419e4e411b9e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Although principles for the determination of [inventory](https://asc.understandingaccounting.org/glossary/i/#inventory "The aggregate of those items of tangible personal property that have any of the following characteristics: Held for sale in the ordinary course of business In process of production for such sale To be currently consumed in the production of goods or services to be available for sale. The term inventory embraces goods awaiting sale (the merchandise of a trading concern and the finished goods of a manufacturer), goods in the course of production (work in process), and goods to be consumed directly or indirectly in production (raw materials and supplies). This definition of inventories excludes long-term assets subject to depreciation accounting, or goods which, when put into use, will be so classified. The fact that a depreciable asset is retired from regular use and held for sale does not indicate that the item should be classified as part of the inventory. Raw materials and supplies purchased for production may be used or consumed for the construction of long-term assets or other purposes not related to production, but the fact that inventory items representing a small portion of the total may not be absorbed ultimately in the production process does not require separate classification. By trade practice, operating materials and supplies of certain types of entities such as oil producers are usually treated as inventory.") costs may be easily stated, their application, particularly to such inventory items as work in process and finished goods, is difficult because of the variety of considerations in the allocation of costs and charges. ##### [330-10-30-3](https://asc.understandingaccounting.org/asc/330/10/#330-10-30-3) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:46.569Z to 2026-09-09T23:50:46.569Z Record version: sha256:0eae4a01df9aa6e2bdb87cbe3f24da92ffdf1c38bb71d6346d03777c3ce1db14 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. For example, variable production overheads are allocated to each unit of production on the basis of the actual use of the production facilities. However, the allocation of fixed production overheads to the costs of conversion is based on the normal capacity of the production facilities. Normal capacity refers to a range of production levels. Normal capacity is the production expected to be achieved over a number of periods or seasons under normal circumstances, taking into account the loss of capacity resulting from planned maintenance. Some variation in production levels from period to period is expected and establishes the range of normal capacity. ##### [330-10-30-4](https://asc.understandingaccounting.org/asc/330/10/#330-10-30-4) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:46.569Z to 2026-09-09T23:50:46.569Z Record version: sha256:da3d3f937dc6d9d605fed23a1f2704ca352f71f65470fce1e2a16ffcb8342e6b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The range of normal capacity will vary based on business- and industry-specific factors. Judgment is required to determine when a production level is abnormally low (that is, outside the range of expected variation in production). ##### [330-10-30-5](https://asc.understandingaccounting.org/asc/330/10/#330-10-30-5) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:46.569Z to 2026-09-09T23:50:46.569Z Record version: sha256:1364e34ce38d77de392156ba2eb4ba6dad6348cd3f2c9156685068006bd06705 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Examples of factors that might be anticipated to cause an abnormally low production level include significantly reduced demand, labor and materials shortages, and unplanned facility or equipment downtime. ##### [330-10-30-6](https://asc.understandingaccounting.org/asc/330/10/#330-10-30-6) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:46.569Z to 2026-09-09T23:50:46.569Z Record version: sha256:d2137c242abf90807ebdbfcdaf56c71a72a0b90f8990720739dda99e4b5eba65 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The actual level of production may be used if it approximates normal capacity. In periods of abnormally high production, the amount of fixed overhead allocated to each unit of production shall be decreased so that inventories are not measured above cost. The amount of fixed overhead allocated to each unit of production shall not be increased as a consequence of abnormally low production or idle plant. ##### [330-10-30-7](https://asc.understandingaccounting.org/asc/330/10/#330-10-30-7) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:46.569Z to 2026-09-09T23:50:46.569Z Record version: sha256:a4f18e34fc5c681e4cd13fa07c04cac29db6f2bcfc3b3375630cc13457f2cc76 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Unallocated overheads shall be recognized as an expense in the period in which they are incurred. Other items such as abnormal freight, handling costs, and amounts of wasted materials (spoilage) require treatment as current period charges rather than as a portion of the inventory cost. ##### [330-10-30-8](https://asc.understandingaccounting.org/asc/330/10/#330-10-30-8) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:46.569Z to 2026-09-09T23:50:46.569Z Record version: sha256:9297f993ac4d4ebfd94b177fd884ec1ae563280ec4cae9437ea3aff83d604423 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Also, under most circumstances, general and administrative expenses shall be included as period charges, except for the portion of such expenses that may be clearly related to production and thus constitute a part of inventory costs (product charges). Selling expenses constitute no part of inventory costs. The exclusion of all overheads from inventory costs does not constitute an accepted accounting procedure. The exercise of judgment in an individual situation involves a consideration of the adequacy of the procedures of the cost accounting system in use, the soundness of the principles thereof, and their consistent application. General and administrative expenses ordinarily shall be charged to expense as incurred. #### Determination of Inventory Costs ##### [330-10-30-9](https://asc.understandingaccounting.org/asc/330/10/#330-10-30-9) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:46.569Z to 2026-09-09T23:50:46.569Z Record version: sha256:cd31f4f6495ca94c8d2ec57347581247b8c6ebe50725a70d6ba1b58d5a0afc1f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Cost for inventory purposes may be determined under any one of several assumptions as to the flow of cost factors, such as first-in first-out (FIFO), average, and last-in first-out (LIFO). The major objective in selecting a method should be to choose the one which, under the circumstances, most clearly reflects periodic income. ##### [330-10-30-10](https://asc.understandingaccounting.org/asc/330/10/#330-10-30-10) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:46.569Z to 2026-09-09T23:50:46.569Z Record version: sha256:282d214ae0cacba40bc4a12c0dc7f09f6bc73562e66a7d58b67cb217a01756db Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The cost to be matched against revenue from a sale may not be the identified cost of the specific item which is sold, especially in cases in which similar goods are purchased at different times and at different prices. While in some lines of business specific lots are clearly identified from the time of purchase through the time of sale and are costed on this basis, ordinarily the identity of goods is lost between the time of acquisition and the time of sale. ##### [330-10-30-11](https://asc.understandingaccounting.org/asc/330/10/#330-10-30-11) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:46.569Z to 2026-09-09T23:50:46.569Z Record version: sha256:53d99b055580e4483362bfd9face4b197e7ed689ab1fa852fdacff6fd8663729 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Accordingly, if the materials purchased in various lots are identical and interchangeable, the use of identified cost of the various lots may not produce the most useful financial statements. This fact has resulted in the general acceptance of several assumptions with respect to the flow of cost factors such as FIFO, average, and LIFO to provide practical bases for the measurement of periodic income. ##### [330-10-30-12](https://asc.understandingaccounting.org/asc/330/10/#330-10-30-12) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:46.569Z to 2026-09-09T23:50:46.569Z Record version: sha256:b7d57cd3e88645916133665afec6a5568674f5493d1a73d9e9ef8d72f2f76179 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Standard costs are acceptable if adjusted at reasonable intervals to reflect current conditions so that at the balance-sheet date standard costs reasonably approximate costs computed under one of the recognized bases. In such cases descriptive language shall be used which will express this relationship, as, for instance, "approximate costs determined on the first-in first-out basis," or, if it is desired to mention standard costs, "at standard costs, approximating average costs." ##### [330-10-30-13](https://asc.understandingaccounting.org/asc/330/10/#330-10-30-13) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:46.569Z to 2026-09-09T23:50:46.569Z Record version: sha256:c14fc7947a3a07d9faecf07096e056d04a9e59a10948bd58516f5549f5466841 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. In some situations a reversed mark-up procedure of inventory pricing, such as the retail inventory method, may be both practical and appropriate. The business operations in some cases may be such as to make it desirable to apply one of the acceptable methods of determining cost to one portion of the inventory or components thereof and another of the acceptable methods to other portions of the inventory. ##### [330-10-30-14](https://asc.understandingaccounting.org/asc/330/10/#330-10-30-14) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:46.569Z to 2026-09-09T23:50:46.569Z Record version: sha256:deecb0471c3d70b32eb62079d40959de5e3a75325d5dcad09ac20e7f95263f40 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Although selection of the method should be made on the basis of the individual circumstances, financial statements will be more useful if uniform methods of inventory pricing are adopted by all entities within a given industry. #### Consistency Required ##### [330-10-30-15](https://asc.understandingaccounting.org/asc/330/10/#330-10-30-15) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:46.569Z to 2026-09-09T23:50:46.569Z Record version: sha256:60a757251608c334d100598ab06f3f92331ff2962c37632c4885b01d76d41bdd Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. While the basis of stating inventories does not affect the overall gain or loss on the ultimate disposition of inventory items, any inconsistency in the selection or employment of a basis may improperly affect the periodic amounts of income or loss. Because of the common use and importance of periodic statements, a procedure adopted for the treatment of inventory items shall be consistently applied in order that the results reported may be fairly allocated between years. #### Purchases and Sales of Inventory with the Same Counterparty ##### [330-10-30-16](https://asc.understandingaccounting.org/asc/330/10/#330-10-30-16) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:46.569Z to 2026-09-09T23:50:46.569Z Record version: sha256:c948b87110a8db34f83ed0c3174a72bf3451c9d5d28ebd47038d4fa7b698b20f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. For a discussion of the initial measurement of inventory purchased from an entity to which it also sells inventory in the same line of business, see paragraphs [845-10-55-10 through 55-26](https://asc.understandingaccounting.org/asc/845/10/#845-10-55-10) . #### Costs Resulting from Share-Based Payment Transactions ##### [330-10-30-17](https://asc.understandingaccounting.org/asc/330/10/#330-10-30-17) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:46.569Z to 2026-09-09T23:50:46.569Z Record version: sha256:ccc669768e997925856520c08601ea02e5484200d9025c68bc05036758b45018 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See paragraph [718-10-25-2](https://asc.understandingaccounting.org/asc/718/10/#718-10-25-2) for a discussion of share-based payment capitalized as a part of inventory. #### Costs of Computer Software to Be Sold, Leased, or Otherwise Marketed ##### [330-10-30-18](https://asc.understandingaccounting.org/asc/330/10/#330-10-30-18) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:46.569Z to 2026-09-09T23:50:46.569Z Record version: sha256:16ee91629192aadbcfbc73a669a8cd9b8eec333c1de374d10fa366d892dae976 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See Sections 985-20-25 and 985-20-35 and paragraphs [985-20-55-2 through 55-3](https://asc.understandingaccounting.org/asc/985/20/#985-20-55-2) for a discussion of accounting for the costs of producing and acquiring computer software, including software that is marketed as part of a product or process. ##### [330-10-30-19](https://asc.understandingaccounting.org/asc/330/10/#330-10-30-19) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:46.569Z to 2026-09-09T23:50:46.569Z Record version: sha256:e41c3fcdc68aae41cd4dbd43775d76da5eb20fd8db73e77698718d79d2096aff Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Paragraph superseded by Accounting Standards Update No. 2014-09](https://asc.understandingaccounting.org/updates/asu-2014-09/). #### Costs to Fulfill a Contract with a Customer ##### [330-10-30-20](https://asc.understandingaccounting.org/asc/330/10/#330-10-30-20) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:46.569Z to 2026-09-09T23:50:46.569Z Record version: sha256:228d2d5f6d6f4d131d193a0dacf2c5880be93b0a4f0570f2abde30d794b5ce6a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See paragraphs [340-40-25-5 through 25-8](https://asc.understandingaccounting.org/asc/340/40/#340-40-25-5) and paragraphs [340-40-35-1 through 35-6](https://asc.understandingaccounting.org/asc/340/40/#340-40-35-1) for the accounting for the costs to fulfill a contract with a customer if those costs are not in the scope of another Topic. #### Indirect Contract Costs by Government Contractors ##### [330-10-30-21](https://asc.understandingaccounting.org/asc/330/10/#330-10-30-21) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:46.569Z to 2026-09-09T23:50:46.569Z Record version: sha256:adf8f1a6e704b42908f81f6a1a0da18bc417a66b29d43bb63278702197f0f40a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See paragraph [912-20-25-1](https://asc.understandingaccounting.org/asc/912/20/#912-20-25-1) for the accounting for indirect contract costs by government contractors. Source downloaded (UTC): 2026-09-09T23:50:48.239Z to 2026-09-09T23:50:48.239Z Record version: sha256:4c26d868a55d7fd57d54f4645713896dfef73e0ea2b3d94f1270f491b23c240a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-10-35: 35 Subsequent Measurement [Read section](https://asc.understandingaccounting.org/asc/330/10/#35-subsequent-measurement) SEC content: no ##### [330-10-35-1](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:48.239Z to 2026-09-09T23:50:48.239Z Record version: sha256:86a2f8c65617e0e4d01a8d004e2a7694bc80d86ab5207534e1085960d004a35f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Paragraph superseded by Accounting Standards Update No. 2015-11](https://asc.understandingaccounting.org/updates/asu-2015-11/). ##### [330-10-35-1A](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-1A) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:48.239Z to 2026-09-09T23:50:48.239Z Record version: sha256:75d470df61da62aa17311e1245a5bfc0ca9304c626d90c5685bad4f9642b605d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The subsequent measurement of [inventory](https://asc.understandingaccounting.org/glossary/i/#inventory "The aggregate of those items of tangible personal property that have any of the following characteristics: Held for sale in the ordinary course of business In process of production for such sale To be currently consumed in the production of goods or services to be available for sale. The term inventory embraces goods awaiting sale (the merchandise of a trading concern and the finished goods of a manufacturer), goods in the course of production (work in process), and goods to be consumed directly or indirectly in production (raw materials and supplies). This definition of inventories excludes long-term assets subject to depreciation accounting, or goods which, when put into use, will be so classified. The fact that a depreciable asset is retired from regular use and held for sale does not indicate that the item should be classified as part of the inventory. Raw materials and supplies purchased for production may be used or consumed for the construction of long-term assets or other purposes not related to production, but the fact that inventory items representing a small portion of the total may not be absorbed ultimately in the production process does not require separate classification. By trade practice, operating materials and supplies of certain types of entities such as oil producers are usually treated as inventory.") depends on the cost method and is different for the following: 1. a Inventory measured using any method other than last-in, first-out (LIFO) or the retail inventory method (see paragraph [330-10-35-1B](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-1B)) 2. b Inventory measured using LIFO or the retail inventory method (see paragraphs [330-10-35-1C through 35-7](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-1C) ). Paragraphs [330-10-35-7A through 35-11](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-7A) apply to all inventory. #### Inventory Measured Using Any Method Other Than LIFO or the Retail Inventory Method ##### [330-10-35-1B](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-1B) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:48.239Z to 2026-09-09T23:50:48.239Z Record version: sha256:952b34218b4bf90197773a215f531c9e17f930453314b8f1d22c3cb799e502d1 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Inventory measured using any method other than LIFO or the retail inventory method (for example, inventory measured using first-in, first-out (FIFO) or average cost) shall be measured at the lower of cost and [net realizable value](https://asc.understandingaccounting.org/glossary/n/#net-realizable-value "Estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation."). When evidence exists that the net realizable value of inventory is lower than its cost, the difference shall be recognized as a loss in earnings in the period in which it occurs. That loss may be required, for example, due to damage, physical deterioration, obsolescence, changes in price levels, or other causes. #### Inventory Measured Using LIFO or the Retail Inventory Method ##### [330-10-35-1C](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-1C) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:48.239Z to 2026-09-09T23:50:48.239Z Record version: sha256:88fdf570e88661950c3a7d660481120130273844be41a4e5f0f10650cec55b87 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A departure from the cost basis of pricing inventory measured using LIFO or the retail inventory method is required when the utility of the goods is no longer as great as their cost. Where there is evidence that the utility of goods, in their disposal in the ordinary course of business, will be less than cost, whether due to damage, physical deterioration, obsolescence, changes in price levels, or other causes, the difference shall be recognized as a loss of the current period. This is generally accomplished by stating such goods at a lower level commonly designated as [market](https://asc.understandingaccounting.org/glossary/m/#market "As used in the phrase lower of cost or market, the term market means current replacement cost (by purchase or by reproduction, as the case may be) provided that it meets both of the following conditions: Market shall not exceed the net realizable valueMarket shall not be less than net realizable value reduced by an allowance for an approximately normal profit margin."). ##### [330-10-35-2](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:48.239Z to 2026-09-09T23:50:48.239Z Record version: sha256:ee54cffbc27a37504870bc38d3cdd677076c8cd15aea8e9b0306f00da5ae46c1 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The cost basis of recording inventory ordinarily achieves the objective of a proper matching of costs and revenues. However, under certain circumstances cost may not be the amount properly chargeable against the revenues of future periods. A departure from cost is required in these circumstances because cost is satisfactory only if the utility of the goods has not diminished since their acquisition; a loss of utility shall be reflected as a charge against the revenues of the period in which it occurs. Thus, in accounting for inventories, a loss shall be recognized whenever the utility of goods is impaired by damage, deterioration, obsolescence, changes in price levels, or other causes. The measurement of such losses for inventory measured using LIFO or the retail inventory method shall be accomplished by applying the rule of pricing inventories at the lower of cost or market. This provides a practical means of measuring utility and thereby determining the amount of the loss to be recognized and accounted for in the current period. ##### [330-10-35-3](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-3) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:48.239Z to 2026-09-09T23:50:48.239Z Record version: sha256:6b0b1a1eb7dfdb650db885573922ec34290ff594c50fff3ea850c128c0a01b3c Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The rule of lower of cost or market is intended to provide a means of measuring the residual usefulness of an inventory expenditure. The term _market_ is therefore to be interpreted as indicating utility on the inventory date and may be thought of in terms of the equivalent expenditure which would have to be made in the ordinary course at that date to procure corresponding utility. ##### [330-10-35-4](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-4) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:48.239Z to 2026-09-09T23:50:48.239Z Record version: sha256:caeeb4a461f5f55c625a0ab703e8577ae3fa7518643c7d10a83bd5b9e6e32d26 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. As a general guide, utility is indicated primarily by the current cost of replacement of the goods as they would be obtained by purchase or reproduction. In applying the rule, however, judgment must always be exercised and no loss shall be recognized unless the evidence indicates clearly that a loss has been sustained. There are therefore exceptions to such a standard. Replacement or reproduction prices would not be appropriate as a measure of utility when the estimated sales value, reduced by the costs of completion and disposal, is lower, in which case the realizable value so determined more appropriately measures utility. ##### [330-10-35-5](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-5) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:48.239Z to 2026-09-09T23:50:48.239Z Record version: sha256:7c4a648a2eb63501f6cf8a90fc45bc986d2f044bbc745ab84748cd0e5eccd0b9 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Furthermore, when the evidence indicates that cost will be recovered with an approximately normal profit upon sale in the ordinary course of business, no loss shall be recognized even though replacement or reproduction costs are lower. This might be true, for example, in the case of production under firm sales contracts at fixed prices, or when a reasonable volume of future orders is assured at stable selling prices. ##### [330-10-35-6](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-6) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:48.239Z to 2026-09-09T23:50:48.239Z Record version: sha256:6e2bac1b99d4be1b86e7fa6913b3783adc539b2a1ab4d1f1628ce5a723730383 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Paragraph superseded by Accounting Standards Update No. 2015-11](https://asc.understandingaccounting.org/updates/asu-2015-11/). ##### [330-10-35-7](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-7) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:48.239Z to 2026-09-09T23:50:48.239Z Record version: sha256:98dcabdacc5760e506266bf3812d6fc12c88244b74cd0f44e1db2e56f7b8eff6 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Because of the many variations of circumstances encountered in inventory pricing, the definition of [market](https://asc.understandingaccounting.org/glossary/m/#market "As used in the phrase lower of cost or market, the term market means current replacement cost (by purchase or by reproduction, as the case may be) provided that it meets both of the following conditions: Market shall not exceed the net realizable valueMarket shall not be less than net realizable value reduced by an allowance for an approximately normal profit margin.") is intended as a guide rather than a literal rule. It shall be applied realistically in light of the objectives expressed in this Subtopic and with due regard to the form, content, and composition of the inventory. For example, the retail inventory method, if adequate markdowns are currently taken, accomplishes the objectives described herein. It is also recognized that, if a business is expected to lose money for a sustained period, the inventory shall not be written down to offset a loss inherent in the subsequent operations. #### Subsequent Measurement Guidance Applicable to All Inventory ##### [330-10-35-7A](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-7A) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:48.239Z to 2026-09-09T23:50:48.239Z Record version: sha256:d25d2d349bc8540d86372443060a4ffaa3d427a4cd193bcb0a7cfcd72a47735b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If inventory has been the hedged item in a fair value hedge, the inventory's cost basis for purposes of subsequent measurement shall reflect the effect of the adjustments of its carrying amount made pursuant to paragraph [815-25-35-1(b)](https://asc.understandingaccounting.org/asc/815/25/#815-25-35-1). ##### [330-10-35-8](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-8) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:48.239Z to 2026-09-09T23:50:48.239Z Record version: sha256:e78fa7cfb2bef2220b2d49eca539e1276010f137c6342efeeec10c7c0b0a25d6 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Depending on the character and composition of the inventory, the guidance in paragraphs [330-10-35-1A through 35-7](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-1A) that is applicable to the inventory being measured may properly be applied either directly to each item or to the total of the inventory (or, in some cases, to the total of the components of each major category). The method shall be that which most clearly reflects periodic income. ##### [330-10-35-9](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-9) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:48.239Z to 2026-09-09T23:50:48.239Z Record version: sha256:a95485e85f71a5e191f63ecca007c59ccb2ad2345c391c4b12b83f6037ef0299 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The purpose of reducing the carrying amount of inventory is to reflect fairly the income of the period. The most common practice is to apply the applicable subsequent measurement guidance separately to each item of the inventory. However, if there is only one end-product category, the application of the applicable subsequent measurement guidance to inventory in its entirety may have the greatest significance for accounting purposes. Accordingly, the remeasurement of individual items may not always lead to the most useful result if the market value (for inventory measured using LIFO or the retail inventory method) or net realizable value (for all other inventory) of the total inventory is not below its cost. This might be the case, for example, if selling prices are not affected by temporary or small fluctuations in current costs of purchase or manufacture. ##### [330-10-35-10](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-10) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:48.239Z to 2026-09-09T23:50:48.239Z Record version: sha256:d51df2533df3acf842d590bb7d1107178038e50d7dc9b15ea59e8852ea31899b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Similarly, where more than one major product or operational category exists, the application of the applicable subsequent measurement guidance to the total of the items included in such major categories may result in the most useful determination of income. When no loss of income is expected to take place as a result of a reduction of cost prices of certain goods because others forming components of the same general categories of finished products have a market value (for inventory measured using LIFO or the retail inventory method) or net realizable value (for all other inventory) equally in excess of cost, such components need not be adjusted to the extent that they are in balanced quantities. Thus, in such cases, the guidance on subsequent measurement may be applied directly to the totals of the entire inventory, rather than to the individual inventory items, if they enter into the same category of finished product and if they are in balanced quantities, provided the procedure is applied consistently from year to year. ##### [330-10-35-11](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-11) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:48.239Z to 2026-09-09T23:50:48.239Z Record version: sha256:792e2935a17d3832968fb4b1ee3cae8f8e66744723b3b396f11d8a9de45dd5ea Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. To the extent, however, that the stocks of particular materials or components are excessive in relation to others, the more widely recognized procedure of applying the guidance on subsequent measurement to the individual items constituting the excess shall be followed. This would also apply in cases in which the items enter into the production of unrelated products or products having a material variation in the rate of turnover. Unless an effective method of classifying categories is practicable, the rule shall be applied to each item in the inventory. ##### [330-10-35-12](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-12) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:48.239Z to 2026-09-09T23:50:48.239Z Record version: sha256:1e5fc7e91f88b782eace5bec25a15962c4b52dafd1b8ea887bd29ed3bae813b2 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See paragraphs [330-10-30-9 through 30-14](https://asc.understandingaccounting.org/asc/330/10/#330-10-30-9) for guidance on inventory pricing methods. #### Loss Due to Sales Incentive ##### [330-10-35-13](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-13) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:48.239Z to 2026-09-09T23:50:48.239Z Record version: sha256:c8ed79c1a477e0ebf88e733fd024c159b8511bc447b0c49b61c43ff48813ea67 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The offer of a sales incentive that will result in a loss on the sale of a product may indicate an impairment of existing inventory under this Subtopic. #### New Cost Basis ##### [330-10-35-14](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-14) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:48.239Z to 2026-09-09T23:50:48.239Z Record version: sha256:d4f387e201c9b35da1f59b26aebb6e0e1fc9a00d0cc3c6d9fc031bb7acd078fa Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. In the case of goods which have been written down below cost at the close of a fiscal year, such reduced amount is to be considered the cost for subsequent accounting purposes. Paragraph [270-10-45-6](https://asc.understandingaccounting.org/asc/270/10/#270-10-45-6) provides guidance for preparing interim financial statements. #### Stating Inventories Above Cost ##### [330-10-35-15](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-15) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:48.239Z to 2026-09-09T23:50:48.239Z Record version: sha256:0d92c0eaaf8af3790036b120ac725bde3d238b4cc8d9624a5dc6480982d17827 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Only in exceptional cases may inventories properly be stated above cost. For example, precious metals having a fixed monetary value with no substantial cost of marketing may be stated at such monetary value; any other exceptions must be justifiable by inability to determine appropriate approximate costs, immediate marketability at quoted market price, and the characteristic of unit interchangeability. ##### [330-10-35-16](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-16) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:48.239Z to 2026-09-09T23:50:48.239Z Record version: sha256:5ed769d55a9079d9b774e326f294152b2c29bcc4cc90406a521d9fcb310b15ec Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. It is generally recognized that income accrues only at the time of sale, and that gains may not be anticipated by reflecting assets at their current sales prices. However, exceptions for reflecting assets at selling prices are permissible for both of the following: 1. a Inventories of gold and silver, when there is an effective government-controlled market at a fixed monetary value 2. b Inventories representing agricultural, mineral, and other products, with all of the following criteria: 1. 1 Units of which are interchangeable 2. 2 Units of which have an immediate marketability at quoted prices 3. 3 Units for which appropriate costs may be difficult to obtain. Where such inventories are stated at sales prices, they shall be reduced by expenditures to be incurred in disposal. #### Purchase Commitments ##### [330-10-35-17](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-17) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:48.239Z to 2026-09-09T23:50:48.239Z Record version: sha256:553ba7bd6679e11212205d9363c13a6e6f1a4eb8680b37eba81dc3bbe0d13c70 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A net loss on firm purchase commitments for goods for inventory, measured in the same way as are inventory losses, shall be recognized in the accounts. The recognition in a current period of losses arising from the decline in the utility of cost expenditures is equally applicable to similar losses which are expected to arise from firm, uncancelable, and unhedged commitments for the future purchase of inventory items. ##### [330-10-35-18](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-18) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:48.239Z to 2026-09-09T23:50:48.239Z Record version: sha256:40ef6eb7ea60cd47d6fa6ada67c0f8a4f6f563773dcf76a50dbb079be1883773 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The utility of such commitments is not impaired, and hence there is no loss, when the amounts to be realized from the disposition of the future inventory items are adequately protected by firm sales contracts or when there are other circumstances that reasonably assure continuing sales without price decline. #### Accounting Changes ##### [330-10-35-19](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-19) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:48.239Z to 2026-09-09T23:50:48.239Z Record version: sha256:76384cf8ecd0f7710d4a182d6b1c634639fbce04b89117dcfdb9f53aca3900d9 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Paragraph [250-10-55-1](https://asc.understandingaccounting.org/asc/250/10/#250-10-55-1) explains that a change in composition of the elements of cost included in inventory is an accounting change and provides related guidance. ##### [330-10-35-20](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-20) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:48.239Z to 2026-09-09T23:50:48.239Z Record version: sha256:26b0329b9de70ffe98f1da5400140d83e6b0ff42d85e9c1bd0375f06812d808e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The definition of [direct effects of a change in accounting principle](https://asc.understandingaccounting.org/glossary/d/#direct-effects-of-a-change-in-accounting-principle "Those recognized changes in assets or liabilities necessary to effect a change in accounting principle. An example of a direct effect is an adjustment to an inventory balance to effect a change in inventory valuation method. Related changes, such as an effect on deferred income tax assets or liabilities or an impairment adjustment resulting from applying the subsequent measurement guidance in Subtopic 330-10to the adjusted inventory balance, also are examples of direct effects of a change in accounting principle.") includes a change in inventory valuation methods as an accounting change. #### Accounting for Consideration Payable to a Customer ##### [330-10-35-21](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-21) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:48.239Z to 2026-09-09T23:50:48.239Z Record version: sha256:e38138e3ae4c907e699f5854b8d443eecb3b9e9e3fd895ddb7c038e22655d0b1 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See paragraphs [606-10-32-25 through 32-27](https://asc.understandingaccounting.org/asc/606/10/#606-10-32-25) for a discussion of consideration given by an entity to a [customer](https://asc.understandingaccounting.org/glossary/c/#customer "A party that has contracted with an entity to obtain goods or services that are an output of the entity's ordinary activities in exchange for consideration."). #### Accounting for Consideration Received from a Vendor ##### [330-10-35-22](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-22) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:48.239Z to 2026-09-09T23:50:48.239Z Record version: sha256:0117f03b6b90e25e29c503b5bfde53b4c4be12e2b8ceb8149cd404b8af8c08a7 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See Subtopic 705-20 on costs of sales and services for a discussion of accounting by an entity, that is, a customer (including a [reseller](https://asc.understandingaccounting.org/glossary/r/#reseller "Any entity that purchases another vendor's products for resale, regardless of whether that entity is a distributor or wholesaler, a retailer, or other type of reseller.")) for, for consideration received from a [vendor](https://asc.understandingaccounting.org/glossary/v/#vendor "A service provider or product seller, such as a manufacturer, distributor, or reseller."). #### Interim Financial Reporting ##### [330-10-35-23](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-23) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:48.239Z to 2026-09-09T23:50:48.239Z Record version: sha256:1ff6547f4ab3c509b0e4693a6c18ad16b7cf06446bd9b301a0e90f52b0b6852f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See paragraph [270-10-45-6](https://asc.understandingaccounting.org/asc/270/10/#270-10-45-6) for a discussion of practices used in determining costs of inventory on an interim basis. Source downloaded (UTC): 2026-09-09T23:50:49.927Z to 2026-09-09T23:50:49.927Z Record version: sha256:8056a76406a5a1fb486746100e4384fa7b9664d674b3cc1ddb89b3f716bebe03 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-10-45: 45 Other Presentation Matters [Read section](https://asc.understandingaccounting.org/asc/330/10/#45-other-presentation-matters) SEC content: no #### Change in Composition Is Accounting Change ##### [330-10-45-1](https://asc.understandingaccounting.org/asc/330/10/#330-10-45-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:49.927Z to 2026-09-09T23:50:49.927Z Record version: sha256:3836353150c11c4ff50b439dc52767e657612aa25262cb16ca0d794a87aae36f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See paragraph [330-10-35-19](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-19) for guidance on dealing with the effects of an accounting change resulting from a change in elements of cost included in [inventory](https://asc.understandingaccounting.org/glossary/i/#inventory "The aggregate of those items of tangible personal property that have any of the following characteristics: Held for sale in the ordinary course of business In process of production for such sale To be currently consumed in the production of goods or services to be available for sale. The term inventory embraces goods awaiting sale (the merchandise of a trading concern and the finished goods of a manufacturer), goods in the course of production (work in process), and goods to be consumed directly or indirectly in production (raw materials and supplies). This definition of inventories excludes long-term assets subject to depreciation accounting, or goods which, when put into use, will be so classified. The fact that a depreciable asset is retired from regular use and held for sale does not indicate that the item should be classified as part of the inventory. Raw materials and supplies purchased for production may be used or consumed for the construction of long-term assets or other purposes not related to production, but the fact that inventory items representing a small portion of the total may not be absorbed ultimately in the production process does not require separate classification. By trade practice, operating materials and supplies of certain types of entities such as oil producers are usually treated as inventory."). ##### [330-10-45-2](https://asc.understandingaccounting.org/asc/330/10/#330-10-45-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:49.927Z to 2026-09-09T23:50:49.927Z Record version: sha256:1a5b276dc47473f8a5eab55570583ef5f787b273918e92aefe7887985d880bb7 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Paragraph superseded by Accounting Standards Update No. 2014-09](https://asc.understandingaccounting.org/updates/asu-2014-09/). Source downloaded (UTC): 2026-09-09T23:50:51.981Z to 2026-09-09T23:50:51.981Z Record version: sha256:38f09360d2a43bc75833eec266a734ac69ce27b2cc0957973d2c28f4041ea049 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-10-50: 50 Disclosure [Read section](https://asc.understandingaccounting.org/asc/330/10/#50-disclosure) SEC content: no #### Basis for Stating Inventories ##### [330-10-50-1](https://asc.understandingaccounting.org/asc/330/10/#330-10-50-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:51.981Z to 2026-09-09T23:50:51.981Z Record version: sha256:b05c136435bd0cff6d6e83d4d13fa7e6ed485ef8394d0d70234103e4f537a930 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The basis of stating inventories shall be consistently applied and shall be disclosed in the financial statements; whenever a significant change is made therein, there shall be disclosure of the nature of the change and, if material, the effect on income. A change of such basis may have an important effect upon the interpretation of the financial statements both before and after that change, and hence, in the event of a change, a full disclosure of its nature and of its effect, if material, upon income shall be made. See paragraph [210-10-50-1](https://asc.understandingaccounting.org/asc/210/10/#210-10-50-1). #### Losses from the Subsequent Measurement of Inventory ##### [330-10-50-2](https://asc.understandingaccounting.org/asc/330/10/#330-10-50-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:51.981Z to 2026-09-09T23:50:51.981Z Record version: sha256:f13078a9cc9aca82e6fae2d57a8abb87fa9f0a8c54560875d5395b92d45b0b8d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Substantial and unusual losses that result from the subsequent measurement of [inventory](https://asc.understandingaccounting.org/glossary/i/#inventory "The aggregate of those items of tangible personal property that have any of the following characteristics: Held for sale in the ordinary course of business In process of production for such sale To be currently consumed in the production of goods or services to be available for sale. The term inventory embraces goods awaiting sale (the merchandise of a trading concern and the finished goods of a manufacturer), goods in the course of production (work in process), and goods to be consumed directly or indirectly in production (raw materials and supplies). This definition of inventories excludes long-term assets subject to depreciation accounting, or goods which, when put into use, will be so classified. The fact that a depreciable asset is retired from regular use and held for sale does not indicate that the item should be classified as part of the inventory. Raw materials and supplies purchased for production may be used or consumed for the construction of long-term assets or other purposes not related to production, but the fact that inventory items representing a small portion of the total may not be absorbed ultimately in the production process does not require separate classification. By trade practice, operating materials and supplies of certain types of entities such as oil producers are usually treated as inventory.") (see paragraphs [330-10-35-1A through 35-11](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-1A) ) should be disclosed in the financial statements. #### Goods Stated Above Cost ##### [330-10-50-3](https://asc.understandingaccounting.org/asc/330/10/#330-10-50-3) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:51.981Z to 2026-09-09T23:50:51.981Z Record version: sha256:c328f9d9919a270f9854c2b09d7a68a6e8b2ceb4fee275e3a0cf8c63aad80a5e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Where goods are stated above cost this fact shall be fully disclosed. #### Stating Inventories at Sales Prices ##### [330-10-50-4](https://asc.understandingaccounting.org/asc/330/10/#330-10-50-4) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:51.981Z to 2026-09-09T23:50:51.981Z Record version: sha256:4b96e452254c6fe41a6c1848347eeca6cb8986e011661da61b97542610a6d86d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Where such inventories are stated at sales prices, the use of such basis shall be fully disclosed in the financial statements. #### Losses on Firm Purchase Commitments ##### [330-10-50-5](https://asc.understandingaccounting.org/asc/330/10/#330-10-50-5) Pending content: yes Source downloaded (UTC): 2026-09-09T23:50:51.981Z to 2026-09-09T23:50:51.981Z Record version: sha256:e16fd56d06401de57917d210c435da9cfec79c8ca5760509225f20df626ef912 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The amounts of net losses on firm purchase commitments accrued under paragraph [330-10-35-17](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-17) shall be disclosed separately in the income statement. Transition date:(P) December 16, 2026; (N) December 16, 2026Transition guidance: [220-40-65-1](https://asc.understandingaccounting.org/asc/220/40/#220-40-65-1)The amounts of net losses on firm purchase commitments accrued under paragraph [330-10-35-17](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-17) shall be disclosed separately in the income statement. See paragraphs [220-40-50-21 through 50-25](https://asc.understandingaccounting.org/asc/220/40/#220-40-50-21) for additional disclosure requirements. #### Disclosure of Significant Estimates ##### [330-10-50-6](https://asc.understandingaccounting.org/asc/330/10/#330-10-50-6) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:51.981Z to 2026-09-09T23:50:51.981Z Record version: sha256:5a1e3f47e54c46fdd4ffb498926935dcda6e8986a4ca0306c801189c2f2a4fe3 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See Example 1 (paragraph [330-10-55-8](https://asc.understandingaccounting.org/asc/330/10/#330-10-55-8)) for an illustration of the disclosure of significant estimates applicable to inventories as required by Section 275-10-50. Source downloaded (UTC): 2026-09-09T23:50:55.858Z to 2026-09-09T23:50:55.858Z Record version: sha256:db93578e3e072edec46122e2781f91ffdf34290a562c3184a5e9fadbdf75689a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-10-55: 55 Implementation Guidance and Illustrations [Read section](https://asc.understandingaccounting.org/asc/330/10/#55-implementation-guidance-and-illustrations) SEC content: no ##### [330-10-55-1](https://asc.understandingaccounting.org/asc/330/10/#330-10-55-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:55.858Z to 2026-09-09T23:50:55.858Z Record version: sha256:613957398de308d5d689249e013fd482b5e6696b6d05431dc53467b3ce45ee36 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Section, which is an integral part of the requirements of this Topic, provides general guidance to be used in accounting for [inventory](https://asc.understandingaccounting.org/glossary/i/#inventory "The aggregate of those items of tangible personal property that have any of the following characteristics: Held for sale in the ordinary course of business In process of production for such sale To be currently consumed in the production of goods or services to be available for sale. The term inventory embraces goods awaiting sale (the merchandise of a trading concern and the finished goods of a manufacturer), goods in the course of production (work in process), and goods to be consumed directly or indirectly in production (raw materials and supplies). This definition of inventories excludes long-term assets subject to depreciation accounting, or goods which, when put into use, will be so classified. The fact that a depreciable asset is retired from regular use and held for sale does not indicate that the item should be classified as part of the inventory. Raw materials and supplies purchased for production may be used or consumed for the construction of long-term assets or other purposes not related to production, but the fact that inventory items representing a small portion of the total may not be absorbed ultimately in the production process does not require separate classification. By trade practice, operating materials and supplies of certain types of entities such as oil producers are usually treated as inventory."). Certain assumptions have been made to simplify the computations and focus on the issue at hand in each illustration. #### Implementation Guidance ##### [330-10-55-2](https://asc.understandingaccounting.org/asc/330/10/#330-10-55-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:55.858Z to 2026-09-09T23:50:55.858Z Record version: sha256:0b4ad80ad03189855caac18e69687d2a62f14e846e9e60e28221036ea151b0ff Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If near-term price recovery is uncertain, a decline in the [market](https://asc.understandingaccounting.org/glossary/m/#market "As used in the phrase lower of cost or market, the term market means current replacement cost (by purchase or by reproduction, as the case may be) provided that it meets both of the following conditions: Market shall not exceed the net realizable valueMarket shall not be less than net realizable value reduced by an allowance for an approximately normal profit margin.") value (for inventory measured using LIFO or the retail inventory method) or [net realizable value](https://asc.understandingaccounting.org/glossary/n/#net-realizable-value "Estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation.") (for all other inventory) of inventory below cost during an interim period shall be accounted for consistent with annual periods, except as described in paragraph [270-10-45-6](https://asc.understandingaccounting.org/asc/270/10/#270-10-45-6). 1. a [Subparagraph superseded by Accounting Standards Update No. 2015-11](https://asc.understandingaccounting.org/updates/asu-2015-11/). 2. b [Subparagraph superseded by Accounting Standards Update No. 2015-11](https://asc.understandingaccounting.org/updates/asu-2015-11/). ##### [330-10-55-3](https://asc.understandingaccounting.org/asc/330/10/#330-10-55-3) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:55.858Z to 2026-09-09T23:50:55.858Z Record version: sha256:bad09ce8042007a4934688238168f8176243309efda806532c5405e82c307c8a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The following provides guidance as to whether the types of costs that are required to be allocated to inventories for tax purposes under the Uniform Capitalization Rules for Inventory under the Tax Reform Act of 1986 would be capitalizable under generally accepted accounting principles (GAAP) and, if so, whether the costing method required for tax purposes is a preferable method for purposes of justifying a change in accounting principle. ##### [330-10-55-4](https://asc.understandingaccounting.org/asc/330/10/#330-10-55-4) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:55.858Z to 2026-09-09T23:50:55.858Z Record version: sha256:7bee60da281d43eb68966635314e6d3c78f9db52126cfaccd41c0c825d3637fc Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The fact that a cost is capitalizable for tax purposes does not, in itself, indicate that it is preferable, or even appropriate, to capitalize that cost for financial reporting purposes. Certain of the additional costs that are required to be capitalized for tax purposes may also be capitalizable for financial reporting purposes, depending on factors such as the nature of the entity's operation and industry practice. That determination, however, can only be made after an analysis of the individual facts and circumstances. ##### [330-10-55-5](https://asc.understandingaccounting.org/asc/330/10/#330-10-55-5) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:55.858Z to 2026-09-09T23:50:55.858Z Record version: sha256:ed85d5cdd0989705f439341ccacc0edafa132c163b4c0739281daa61b77258aa Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Paragraph superseded by Accounting Standards Update No. 2017-07](https://asc.understandingaccounting.org/updates/asu-2017-07/). ##### [330-10-55-6](https://asc.understandingaccounting.org/asc/330/10/#330-10-55-6) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:55.858Z to 2026-09-09T23:50:55.858Z Record version: sha256:e9d2085729f55a63d77680152e1638931d776687347753cc2b983dcfd106f30e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Paragraph superseded by Accounting Standards Update No. 2017-07](https://asc.understandingaccounting.org/updates/asu-2017-07/). ##### [330-10-55-6A](https://asc.understandingaccounting.org/asc/330/10/#330-10-55-6A) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:55.858Z to 2026-09-09T23:50:55.858Z Record version: sha256:e32cb0393869c016e8eea6676dc7eba47329ea9c8f1cd678ae427c23fcf9fb7a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The service cost component of net periodic pension cost and net periodic postretirement benefit cost is the only component directly arising from employees' services provided in the current period. Therefore, when it is appropriate to capitalize employee compensation in connection with the construction or production of an asset, the service cost component applicable to the pertinent employees for the period is the relevant amount to be considered for capitalization. ##### [330-10-55-7](https://asc.understandingaccounting.org/asc/330/10/#330-10-55-7) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:55.858Z to 2026-09-09T23:50:55.858Z Record version: sha256:a2e73a31adde2651d6742b780e10812f8c1ac412cdbc9067a70d78139901d4cd Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Paragraph superseded by Accounting Standards Update No. 2017-07](https://asc.understandingaccounting.org/updates/asu-2017-07/). #### Illustrations ##### [330-10-55-8](https://asc.understandingaccounting.org/asc/330/10/#330-10-55-8) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:55.858Z to 2026-09-09T23:50:55.858Z Record version: sha256:68f2cce41209beec586bb21344aeef28bddefbdafec3857027bf888f3f751713 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Example illustrates the guidance in paragraph [330-10-50-6](https://asc.understandingaccounting.org/asc/330/10/#330-10-50-6) regarding the disclosure of significant estimates related to inventory. Entity A manufactures high technology stereo equipment. In June 19X7, one of Entity A's competitors introduced a new model stereo system with the same features as Entity A's Model A. The competitor's version sells for significantly less than Entity A's suggested retail price for Model A. The introduction of this product resulted in a sharp decrease in the sales volume of Model A. As of December 31, 19X7, Entity A has accumulated significant inventory quantities beyond its normal short-term needs of its Model A system. Inventory for Model A ($6 million) represents approximately 20 percent of Entity A's inventory at that date. The remaining 80 percent of Entity A's inventory consists of products experiencing only normal competitive pressures. Entity A has established provisions for obsolescence for this latter group of products in the normal course of business. ##### [330-10-55-9](https://asc.understandingaccounting.org/asc/330/10/#330-10-55-9) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:55.858Z to 2026-09-09T23:50:55.858Z Record version: sha256:1349289d71460d11ffd57b2513cf2643648f2e880c84196458a13af606e16578 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Management has developed a program to provide substantial dealer incentives on purchases of the Model A, which it expects will result in the sale of this inventory in the near term. Because of the existing high profit margin on its stereo systems, Entity A would continue to earn a marginal profit on sales of the Model A under the new program. It is also reasonably possible, however, that the program will not be wholly successful, and, accordingly, a material loss could ultimately result on the disposal of the inventory. ##### [330-10-55-10](https://asc.understandingaccounting.org/asc/330/10/#330-10-55-10) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:55.858Z to 2026-09-09T23:50:55.858Z Record version: sha256:4744e27b858ca10180671b84d4517e02fe037ab8488c373e1247aafb8eb6e5b7 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The entity would disclose the following. - As of December 31, 19X7, some portion of $6 million of inventory of one of the entity's products is in excess of Entity A's current requirements based on the recent level of sales. Management has developed a program to reduce this inventory to desired levels over the near term and believes no loss will be incurred on its disposition. No estimate can be made of a range of amounts of loss that are reasonably possible should the program not be successful. ##### [330-10-55-11](https://asc.understandingaccounting.org/asc/330/10/#330-10-55-11) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:55.858Z to 2026-09-09T23:50:55.858Z Record version: sha256:22839f76360ae094774a7ec3771f698edbc30b539ed4b92bf20f5e715298380b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This situation meets the criteria for disclosure under paragraph [275-10-50-8](https://asc.understandingaccounting.org/asc/275/10/#275-10-50-8) because circumstances that existed at the date of the financial statements, including the decreasing sales volume and excessive quantities of inventory of Model A, make it at least reasonably possible that management's plan to liquidate its excess inventory without a loss will be less than fully successful and that such an outcome would have a near-term material effect on the entity's financial statements. ##### [330-10-55-12](https://asc.understandingaccounting.org/asc/330/10/#330-10-55-12) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:55.858Z to 2026-09-09T23:50:55.858Z Record version: sha256:df828d24e1dfd6c97df2fc1ee90f45ae7bb316d80f1fe5726c4591b19fb351a7 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. In this Example, Entity A discloses the existence of potentially excess quantities of inventory at the date of the financial statements and indicates that the uncertainty is expected to be resolved in the near term. The disclosure is intended to provide users with insight into management's assessment of recoverability of the cost of inventories existing at the date of the financial statements. Although disclosure of the $6 million carrying amount of the inventory of Model A is not required because, based on the facts presented, $6 million does not constitute a reasonable estimate of loss on the disposal of the inventory or the maximum amount in an estimated range of loss, disclosure of this amount is not misleading and may provide useful information. ##### [330-10-55-13](https://asc.understandingaccounting.org/asc/330/10/#330-10-55-13) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:55.858Z to 2026-09-09T23:50:55.858Z Record version: sha256:f7cead5a6eb8e782ba4e44761e6629dcc813c5b0589a7f067261e621ba1523b4 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Discussion of Entity A's provision for obsolescence for the remaining 80 percent of its inventory is not required because it is not considered reasonably possible that additional material losses on this inventory will occur. Source downloaded (UTC): 2026-09-09T23:50:59.127Z to 2026-09-09T23:50:59.127Z Record version: sha256:a2623fc27dde404338cabc7e2585a66380d98bb829fb43985402cbb86310de51 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-10-65: 65 Transition and Open Effective Date Information [Read section](https://asc.understandingaccounting.org/asc/330/10/#65-transition-and-open-effective-date-information) SEC content: no ##### [330-10-65-1](https://asc.understandingaccounting.org/asc/330/10/#330-10-65-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:50:59.127Z to 2026-09-09T23:50:59.127Z Record version: sha256:993126433434d44a2c759c644e801523e1ddbd25a16950fa48aea768064a785f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Paragraph superseded on 06/20/2018 after the end of the transition period stated in Accounting Standards Update No. 2015-11, _Inventory (Topic 330): Simplifying the Measurement of Inventory_. Source downloaded (UTC): 2026-09-09T23:51:04.651Z to 2026-09-09T23:51:04.651Z Record version: sha256:bdc3f80e6f4b7db1cc309ad377aa0529473e0b9ab436af720ecba6a211ebc37a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-10-S00: SEC 00 Status [Read section](https://asc.understandingaccounting.org/asc/330/10/#sec-00-status) SEC content: yes ##### [330-10-S00-1](https://asc.understandingaccounting.org/asc/330/10/#330-10-S00-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:04.651Z to 2026-09-09T23:51:04.651Z Record version: sha256:bfaeb259264776c438a5fdfaef7f300ed9c1619b5b0c2035dcca8dcd8c13d6c5 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The following table identifies the changes made to this Subtopic.
ParagraphActionAccounting Standards UpdateDate
330-10-S35-2AmendedAccounting Standards Update No. 2009-0709/15/2009
330-10-S99-1AmendedAccounting Standards Update No. 2012-0308/27/2012
330-10-S99-2AmendedAccounting Standards Update No. 2012-0308/27/2012
Source downloaded (UTC): 2026-09-09T23:51:08.071Z to 2026-09-09T23:51:08.071Z Record version: sha256:6ed60e9315c0263b218569b15f07d57a2810e297eff52d98a8afc33600b913b6 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-10-S35: SEC 35 Subsequent Measurement [Read section](https://asc.understandingaccounting.org/asc/330/10/#sec-35-subsequent-measurement) SEC content: yes #### Restoration of Previously Written-Down Inventory Value ##### [330-10-S35-1](https://asc.understandingaccounting.org/asc/330/10/#330-10-S35-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:08.071Z to 2026-09-09T23:51:08.071Z Record version: sha256:611987f380ac2ab5c06229733e6593d46c9ebd934bdfe70f4bbf547afdadacc0 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See paragraph [330-10-S99-2](https://asc.understandingaccounting.org/asc/330/10/#330-10-S99-2), SAB Topic 5.BB, for SEC Staff views on restoration of inventory value following a previous write-down to lower of cost or market. #### Classification of Inventory Markdowns and Other Costs Associated with a Restructuring ##### [330-10-S35-2](https://asc.understandingaccounting.org/asc/330/10/#330-10-S35-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:08.071Z to 2026-09-09T23:51:08.071Z Record version: sha256:5a504aa73dd92d8e2aa2d6cb3ea881bbae50735031ff55f1410068312b8c29ba Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See paragraph [420-10-S99-3](https://asc.understandingaccounting.org/asc/420/10/#420-10-S99-3), SEC Observer Comment: Classification of Inventory Markdowns and Other Costs Associated with Restructuring, for SEC Staff views on income statement classification of inventory markdowns associated with a restructuring. Source downloaded (UTC): 2026-09-09T23:51:10.448Z to 2026-09-09T23:51:10.448Z Record version: sha256:02f70d5a541ca0ffbd72a4c433ccb0e7513724d6a2d4df0baa585f4124e2c687 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-10-S45: SEC 45 Other Presentation Matters [Read section](https://asc.understandingaccounting.org/asc/330/10/#sec-45-other-presentation-matters) SEC content: yes #### Separate Presentation of Classes of Inventory ##### [330-10-S45-1](https://asc.understandingaccounting.org/asc/330/10/#330-10-S45-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:10.448Z to 2026-09-09T23:51:10.448Z Record version: sha256:12ecefb984489a86166b10cd4037f1aa82832e77c0a8bae825043cbc045e88ef Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See paragraph [210-10-S99-1](https://asc.understandingaccounting.org/asc/210/10/#210-10-S99-1), Regulation S-X Rule 5-02.6, for requirements for inventory presentation on the balance sheet. Source downloaded (UTC): 2026-09-09T23:51:13.083Z to 2026-09-09T23:51:13.083Z Record version: sha256:2d068aaa667f784d7939a6059e11aae6098e8c97cd6db34df0c1ebe6d77dbd24 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-10-S50: SEC 50 Disclosure [Read section](https://asc.understandingaccounting.org/asc/330/10/#sec-50-disclosure) SEC content: yes #### Inventory Disclosure Requirements ##### [330-10-S50-1](https://asc.understandingaccounting.org/asc/330/10/#330-10-S50-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:13.083Z to 2026-09-09T23:51:13.083Z Record version: sha256:dda3f747ef303129b99a3bf100070dcd6f13b4e8430de10bcccc748f657aca16 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See paragraph [210-10-S99-1](https://asc.understandingaccounting.org/asc/210/10/#210-10-S99-1), Regulation S-X Rules 5-02.6(b) through (d), for inventory disclosure requirements. #### LIFO Liquidations ##### [330-10-S50-2](https://asc.understandingaccounting.org/asc/330/10/#330-10-S50-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:13.083Z to 2026-09-09T23:51:13.083Z Record version: sha256:543b733917c28ade021c8808c85e770937654749cc68a83d61de5a3d4758ff0a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See paragraph [330-10-S99-3](https://asc.understandingaccounting.org/asc/330/10/#330-10-S99-3), SAB Topic 11.F, for SEC Staff views on disclosure of income realized as a result of a last-in, first-out (LIFO) liquidation. Source downloaded (UTC): 2026-09-09T23:51:16.811Z to 2026-09-09T23:51:16.811Z Record version: sha256:67a424d19b324c31db65fe2a39d7f10127c49eecc03f84c9ca16ab7b107ed263 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-10-S55: SEC 55 Implementation Guidance and Illustrations [Read section](https://asc.understandingaccounting.org/asc/330/10/#sec-55-implementation-guidance-and-illustrations) SEC content: yes #### LIFO Inventory Practices ##### [330-10-S55-1](https://asc.understandingaccounting.org/asc/330/10/#330-10-S55-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:16.811Z to 2026-09-09T23:51:16.811Z Record version: sha256:da66a936a84b9969a5f70d47d3abb1f06ab18f17f94fc69300c264d95e528534 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See paragraph [330-10-S99-1](https://asc.understandingaccounting.org/asc/330/10/#330-10-S99-1), SAB Topic 5.L, for SEC Staff views on appropriate last-in, first-out (LIFO) accounting practices. Source downloaded (UTC): 2026-09-09T23:51:21.227Z to 2026-09-09T23:51:21.227Z Record version: sha256:9c410604e70bd615546ca076dc5f830bf3e49a0c942d959abff6d42f63050255 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-10-S99: SEC 99 SEC Materials [Read section](https://asc.understandingaccounting.org/asc/330/10/#sec-99-sec-materials) SEC content: yes #### SEC Staff Guidance ##### [330-10-S99-1](https://asc.understandingaccounting.org/asc/330/10/#330-10-S99-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:21.227Z to 2026-09-09T23:51:21.227Z Record version: sha256:69dbfb876f7bd5a8088b559b7bb01460260105826acb4e3613dc2884afd50ef6 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The following is the text of SAB Topic 5.L, LIFO Inventory Practices. - Facts: On November 30, 1984, AcSEC and its Task Force on LIFO Inventory Problems (task force) issued a paper, "Identification and Discussion of Certain Financial Accounting and Reporting Issues Concerning LIFO Inventories." This paper identifies and discusses certain financial accounting and reporting issues related to the last-in, first-out (LIFO) inventory method for which authoritative accounting literature presently provides no definitive guidance. For some issues, the task force's advisory conclusions recommend changes in current practice to narrow the diversity which the task force believes exists. For other issues, the task force's advisory conclusions recommend that current practice should be continued for financial reporting purposes and that additional accounting guidance is unnecessary. Except as otherwise noted in the paper, AcSEC generally supports the task force's advisory conclusions. As stated in the issues paper, "Issues papers of the AICPA's accounting standards division are developed primarily to identify financial accounting and reporting issues the division believes need to be addressed or clarified by the Financial Accounting Standards Board." On February 6, 1985, the FASB decided not to add to its agenda a narrow project on the subject of LIFO inventory practices. - Question 1: What is the SEC staff's position on the issues paper? - Interpretive Response: In the absence of existing authoritative literature on LIFO accounting, the staff believes that registrants and their independent accountants should look to the paper for guidance in determining what constitutes acceptable LIFO accounting practice. FN11 In this connection, the staff considers the paper to be an accumulation of existing acceptable LIFO accounting practices which does not establish any new standards and does not diverge from GAAP. - FN11 In ASR 293 (July 2, 1981) see Financial Reporting Codification 205, the Commission expressed its concerns about the inappropriate use of Internal Revenue Service (IRS) LIFO practices for financial statement preparation. Because the IRS amended its regulations concerning the LIFO conformity rule on January 13, 1981, allowing companies to apply LIFO differently for financial reporting purposes than for tax purposes, the Commission strongly encouraged registrants and their independent accountants to examine their financial reporting LIFO practices. In that release, the Commission acknowledged the "task force which has been established by AcSEC to accumulate information about \[LIFO\] application problems" and noted that "This type of effort, in addition to self-examination \[of LIFO practices\] by individual registrants, is appropriate..." - The staff also believes that the advisory conclusions recommended in the issues paper are generally consistent with conclusions previously expressed by the Commission, such as: - 1\. Pooling-paragraph 4-6 of the paper discusses LIFO inventory pooling and concludes "establishing separate pools with the principal objective of facilitating inventory liquidations is unacceptable." In Accounting and Auditing Enforcement Release 35, August 13, 1984, the Commission stated that it believes that the Company improperly realigned its LIFO pools in such a way as to maximize the likelihood and magnitude of LIFO liquidations and thus, overstated net income. - 2\. New Items-paragraph 4-27 of the paper discusses determination of the cost of new items and concludes "if the double extension or an index technique is used, the objective of LIFO is achieved by reconstructing the base year cost of new items added to existing pools." In ASR 293, the Commission stated that when the effects of inflation on the cost of new products are measured by making a comparison with current cost as the base-year cost, rather than a reconstructed base-year cost, income is improperly increased. - Question 2: If a registrant utilizes a LIFO practice other than one recommended by an advisory conclusion in the issues paper, must the registrant change its practice to one specified in the paper? - Interpretive Response: Now that the issues paper is available, the staff believes that a registrant and its independent accountants should re-examine previously adopted LIFO practices and compare them to the recommendations in the paper. In the event that the registrant and its independent accountants conclude that the registrant's LIFO practices are preferable in the circumstances, they should be prepared to justify their position in the event that a question is raised by the staff. - Question 3: If a registrant elects to change its LIFO practices to be consistent with the guidance in the issues paper and discloses such changes in accordance with FASB ASC Topic 250, Accounting Changes and Error Corrections, will the registrant be requested by the staff to explain its past practices and its justification for those practices? - Interpretive Response: The staff does not expect to routinely raise questions about changes in LIFO practices which are made to make a company's accounting consistent with the recommendations in the issues paper. ##### [330-10-S99-2](https://asc.understandingaccounting.org/asc/330/10/#330-10-S99-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:21.227Z to 2026-09-09T23:51:21.227Z Record version: sha256:fd60deef912410b10c73b0b66a99ea3ad157ece3349e28e3e4a5b484fcc64810 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The following is the text of SAB Topic 5.BB, Inventory Valuation Allowance. - Facts: FASB ASC paragraph [330-10-35-1](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-1) (Inventory Topic), specifies that: "\[a\] departure from the cost basis of pricing the inventory is required when the utility of the goods is no longer as great as its cost. Where there is evidence that the utility of goods, in their disposal in the ordinary course of business, will be less than cost, whether due to physical deterioration, obsolescence, changes in price levels, or other causes, the difference shall be recognized as a loss of the current period. This is generally accomplished by stating such goods at a lower level commonly designated as market." - FASB ASC paragraph [330-10-35-14](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-14) indicates that "\[i\]n the case of goods which have been written down below cost at the close of a fiscal year, such reduced amount is to be considered the cost for subsequent accounting purposes." - Lastly, the FASB ASC Master Glossary provides "inventory obsolescence" as one of the items subject to a change in accounting estimate. - Question: Does the write-down of inventory to the lower of cost or market, as required by FASB ASC Topic 330, create a new cost basis for the inventory or may a subsequent change in facts and circumstances allow for restoration of inventory value, not to exceed original historical cost? - Interpretive Response: Based on FASB ASC paragraph [330-10-35-14](https://asc.understandingaccounting.org/asc/330/10/#330-10-35-14), the staff believes that a write-down of inventory to the lower of cost or market at the close of a fiscal period creates a new cost basis that subsequently cannot be marked up based on changes in underlying facts and circumstances. FN59 - FN59 See also disclosure requirement for inventory balances in Rule 5-02(6) of Regulation S-X. ##### [330-10-S99-3](https://asc.understandingaccounting.org/asc/330/10/#330-10-S99-3) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:21.227Z to 2026-09-09T23:51:21.227Z Record version: sha256:3b84308d6f41e9e381d79b257a652b9997729e710ed0961d4810032f2703476f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The following is the text of SAB Topic 11.F, LIFO Liquidations. - Facts: Registrant on LIFO basis of accounting liquidates a substantial portion of its LIFO inventory and as a result includes a material amount of income in its income statement which would not have been recorded had the inventory liquidation not taken place. - Question: Is disclosure required of the amount of income realized as a result of the inventory liquidation? - Interpretive Response: Yes. Such disclosure would be required in order to make the financial statements not misleading. Disclosure may be made either in a footnote or parenthetically on the face of the income statement. Source downloaded (UTC): 2026-09-09T23:51:23.210Z to 2026-09-09T23:51:52.923Z Record version: sha256:7b4bb2437434c21948c32428a5426a1b036ded7dcaa987affbf9a13a9980a4f1 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-905: Inventory — Agriculture ### Machine-generated study aids ```json { "summary": "ASC 330-905 applies Inventory guidance to the agricultural industry, covering producers (growing crops, developing animals, harvested crops, livestock held for sale, secondary products), pooling cooperatives, and cooperative patrons. Direct and indirect costs of growing crops are accumulated until harvest, with pre-planting costs deferred and post-harvest cultural costs estimated and accrued to the harvested crop. Harvested crops and animals held for sale may be carried at net realizable value if they have a reliable, readily determinable market price, insignificant and predictable disposal costs, and immediate availability for delivery; otherwise Subtopic 330-10 measurement applies.", "key_points": [ "All direct and indirect costs of growing crops shall be accumulated until harvest; pre-planting costs such as soil preparation are deferred and allocated to the growing crop, and crops requiring more than one year to mature have costs deferred until harvest (330-905-25-1 through 25-2).", "Post-harvest cultural practices (e.g., clearing residue, special tillage, chopping, or burning to overcome a physical or noxious condition) shall be estimated and accrued as costs of the harvested crop (330-905-25-2; 330-905-30-2).", "Animals held for sale and harvested crops are valued under Subtopic 330-10 or at net realizable value if the product has a reliable, readily determinable, and realizable market price, relatively insignificant and predictable disposal costs, and is available for immediate delivery (330-905-35-3 through 35-4).", "A market basis (quoted market prices less estimated direct costs of disposal) is acceptable where a cost basis is not practicable and the products have immediate marketability at prices the producer cannot influence, unit interchangeability, and insignificant disposal costs—e.g., freshly dressed meats (330-905-30-1).", "Animals with short productive lives, such as poultry flocks, may be classified as inventory; other developing, breeding, and production animals are addressed in Subtopic 905-360 (330-905-25-3 through 25-4).", "For pooling cooperatives, board-assigned amounts approximating estimated market for unprocessed patron products are treated as cost and charged to cost of goods sold; if no such amounts are assigned, inventories are accounted for at net realizable value and cost of goods sold includes no charge for unprocessed products (330-905-25-5, 25-7, 35-5).", "Pooling cooperatives shall not use the cash advance method to account for inventories, and the method used and dollar amounts assigned to members' products shall be disclosed (330-905-25-8; 330-905-50-1)." ], "categories": [ "Inventory and PP&E", "Subsequent measurement", "Industry-specific", "Disclosure" ], "audience_level": "intermediate", "student_note": "Agriculture is one of the few industries where GAAP permits carrying inventory above cost at net realizable value, but only when the three conditions in 330-905-35-3(b) are all met—students often assume NRV is freely elective. Also watch the cooperative rules: assigned amounts function as cost, and the cash advance method is prohibited.", "related_topics": [ "330-10", "905-360", "905-10", "905-330", "606" ], "key_concepts": [ "growing crops", "harvested crops", "animals held for sale", "net realizable value", "pooling cooperative", "assigned amounts to patron products", "deferred pre-planting and accrued post-harvest costs", "market basis inventory" ] } ``` Source downloaded (UTC): 2026-09-09T23:51:23.210Z to 2026-09-09T23:51:23.210Z Record version: sha256:b3fcdc0cc770fe8bda2b6a0ece52c8efb1d4b8b9b02cb7880b67d99a25defa03 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-905-00: 00 Status [Read section](https://asc.understandingaccounting.org/asc/330/905/#00-status) SEC content: no ##### [330-905-00-1](https://asc.understandingaccounting.org/asc/330/905/#330-905-00-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:23.210Z to 2026-09-09T23:51:23.210Z Record version: sha256:c5c3d623e543ecd52d2d161f0f56a692be5467d026817c01e324cb30bf9e1832 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The following table identifies the changes made to this Subtopic.
ParagraphActionAccounting Standards UpdateDate
Agricultural CooperativeAddedAccounting Standards Update No. 2014-0603/14/2014
CooperativesSupersededAccounting Standards Update No. 2014-0603/14/2014
Member of an Agricultural CooperativeAddedAccounting Standards Update No. 2014-0603/14/2014
Net Realizable Value (2nd def.)AmendedAccounting Standards Update No. 2014-0603/14/2014
Nonmember of an Agricultural CooperativeAddedAccounting Standards Update No. 2014-0603/14/2014
PatronsAmendedAccounting Standards Update No. 2014-0603/14/2014
905-330-05-1AmendedAccounting Standards Update No. 2014-0603/14/2014
905-330-05-4AmendedAccounting Standards Update No. 2014-0603/14/2014
905-330-05-5AmendedAccounting Standards Update No. 2014-0603/14/2014
905-330-15-2AmendedAccounting Standards Update No. 2014-0603/14/2014
905-330-15-3AmendedAccounting Standards Update No. 2014-0603/14/2014
905-330-25-1AmendedAccounting Standards Update No. 2014-0603/14/2014
905-330-30-3SupersededAccounting Standards Update No. 2014-0905/28/2014
905-330-30-3AmendedAccounting Standards Update No. 2014-0603/14/2014
905-330-30-4AmendedAccounting Standards Update No. 2014-0905/28/2014
905-330-35-1 through 35-3
AmendedAccounting Standards Update No. 2015-1107/22/2015
905-330-35-5AmendedAccounting Standards Update No. 2015-1107/22/2015
905-330-40-1SupersededAccounting Standards Update No. 2014-0905/28/2014
905-330-40-1AmendedAccounting Standards Update No. 2014-0603/14/2014
905-330-55-2 through 55-4
AmendedAccounting Standards Update No. 2015-1107/22/2015
Source downloaded (UTC): 2026-09-09T23:51:24.987Z to 2026-09-09T23:51:24.987Z Record version: sha256:38b23c933df0c16ccfc978767185e8876d935a648b2e89bc5977c1b8cfcfb169 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-905-05: 05 Overview and Background [Read section](https://asc.understandingaccounting.org/asc/330/905/#05-overview-and-background) SEC content: no ##### [330-905-05-1](https://asc.understandingaccounting.org/asc/330/905/#330-905-05-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:24.987Z to 2026-09-09T23:51:24.987Z Record version: sha256:7bf632bc543a0389a5f105098ee2755768a5a0ccff666d2b0c2734051c5486ab Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic addresses inventory accounting for entities in the agricultural industry. The guidance for accounting for different entities in the agricultural industry is presented in the following three Subsections: 1. a General 2. b Cooperatives 3. c Cooperatives—Patrons. ##### [330-905-05-2](https://asc.understandingaccounting.org/asc/330/905/#330-905-05-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:24.987Z to 2026-09-09T23:51:24.987Z Record version: sha256:69a6baa9fa23d7bdb997b724776cd9e639b59f2cb564b28b5e554d97d4b4fc47 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The General Subsections provide guidance for all those entities operating in the agricultural industry as set forth in the [General Subsection](https://asc.understandingaccounting.org/asc/905/10/#05-overview-and-background) of Section 905-10-05. Inventories of [agricultural producers](https://asc.understandingaccounting.org/glossary/a/#agricultural-producers "Farmers and ranchers including, for example, those who raise crops from seeds or seedlings, breed livestock (whether registered or commercial), and feed livestock in preparation for slaughter.") include growing [crops](https://asc.understandingaccounting.org/glossary/c/#crops "Grains, vegetables, fruits, berries, nuts, and fibers grown by agricultural producers."), developing animals to be held for sale, harvested crops, [livestock](https://asc.understandingaccounting.org/glossary/l/#livestock "Registered and commercial cattle, sheep, hogs, horses, poultry, and small animals bred and raised by agricultural producers.") held for sale, and secondary products, such as calves from dairy herds and wool from sheep. ##### [330-905-05-3](https://asc.understandingaccounting.org/asc/330/905/#330-905-05-3) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:24.987Z to 2026-09-09T23:51:24.987Z Record version: sha256:234b700a34556b80aec3b7c7310bf252f969f4db225759a1609f09296c5448dd Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Field and row crops](https://asc.understandingaccounting.org/glossary/f/#field-and-row-crops "Field and row crops are usually planted from seeds or are transplanted from beds and develop to the point of harvest within several months.") with cycles of less than one year that constitute part of inventory are generally classed as annuals. These crops include wheat, barley, milo, corn, soybeans, sugar beets, tobacco, cotton, crops raised for seed, tomatoes, lettuce, beans, cabbages, and melons. ### Cooperatives ##### [330-905-05-4](https://asc.understandingaccounting.org/asc/330/905/#330-905-05-4) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:24.987Z to 2026-09-09T23:51:24.987Z Record version: sha256:ce5f9cbd77cdd14a982cb7bb75f9a2a61f349b404f92eee36f8f03a4ce769ebc Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The Cooperatives Subsections provide guidance about the different accounting methods used by [pooling cooperatives](https://asc.understandingaccounting.org/glossary/p/#pooling-cooperative "A marketing cooperative that receives its members' agricultural products without obligation to pay a fixed price and commingles those products into single or multiple pools for processing and marketing purposes. Pool periods may vary from a week to a year or longer, depending on the product involved. Generally profits or losses are allocated to patrons upon closing of the pool.") for [patron](https://asc.understandingaccounting.org/glossary/p/#patrons "Any individual, trust, estate, partnership, corporation, or agricultural cooperative with or for whom a cooperative does business on a cooperative basis, whether a member of an agricultural cooperative or nonmember of an agricultural cooperative.") product deliveries. These methods have been developed to satisfy provisions of their bylaws and contractual arrangements with patrons and to provide equitable methods of settlement from pool period to pool period, as well as among the various classes of patrons. For pooling cooperatives, accounting methods have been developed to allow the use of the single-pool or multiple-pool methods of accounting. ### Cooperatives—Patrons ##### [330-905-05-5](https://asc.understandingaccounting.org/asc/330/905/#330-905-05-5) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:24.987Z to 2026-09-09T23:51:24.987Z Record version: sha256:932003194bd9bdcfdc3b42df5ec5e53f39077abdae742762bed3cbd48806401e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The Cooperatives—Patrons Subsections address inventory accounting by patrons of [agricultural cooperatives](https://asc.understandingaccounting.org/glossary/a/#agricultural-cooperative "The Agricultural Marketing Act of 1929 defines a cooperative association as any association in which farmers act together in processing, preparing for market, handling, and/or marketing the farm products of persons so engaged, and also means any association in which farmers act together in purchasing, testing, grading, processing, distributing, and/or furnishing farm supplies and/or farm business services. Provided, however, that such associations are operated for producers or purchasers and conform to one or both of the following requirements: No member of an agricultural cooperative association is allowed more than one vote because of the amount of stock or membership capital he may own therein. The association does not pay dividends on stock or membership capital in excess of 8 percent per year. In addition to meeting either of the requirements in this paragraph, the association shall not deal in farm products, farm supplies, and farm business services with or for nonmembers of an agricultural cooperative in an amount greater in value than the total amount of such business transacted by it with or for members. All business transacted by any cooperative association for or on behalf of the United States or any agency or instrumentality thereof shall be disregarded in determining the volume of member and nonmember business transacted by such association."). Source downloaded (UTC): 2026-09-09T23:51:28.028Z to 2026-09-09T23:51:28.028Z Record version: sha256:04cf9584b2b880462f3ea5f0eb1944453cf5cb1f62b6de2359b18f412ea3db34 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-905-15: 15 Scope and Scope Exceptions [Read section](https://asc.understandingaccounting.org/asc/330/905/#15-scope-and-scope-exceptions) SEC content: no #### Overall Guidance ##### [330-905-15-1](https://asc.understandingaccounting.org/asc/330/905/#330-905-15-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:28.028Z to 2026-09-09T23:51:28.028Z Record version: sha256:d8da23d6eff2530449925cdf0c721b30ff3272ea1b98708aa9656f0ed12c5a11 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see the [General Subsection](https://asc.understandingaccounting.org/asc/905/10/#15-scope-and-scope-exceptions) of Section 905-10-15. ### Cooperatives ##### [330-905-15-2](https://asc.understandingaccounting.org/asc/330/905/#330-905-15-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:28.028Z to 2026-09-09T23:51:28.028Z Record version: sha256:735133d200231e705c7a1fa0abbd3c899cf18211da091880f42b906e5306924a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The Cooperatives Subsections follow the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see the [Cooperatives Subsection](https://asc.understandingaccounting.org/asc/905/10/#15-scope-and-scope-exceptions) of Section 905-10-15. ### Cooperatives—Patrons ##### [330-905-15-3](https://asc.understandingaccounting.org/asc/330/905/#330-905-15-3) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:28.028Z to 2026-09-09T23:51:28.028Z Record version: sha256:ce90a3b07f9d53da2e41b03b7a9449ff1ed5285c403a6923a6ac63739df890f6 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The Cooperatives—Patrons Subsections follow the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see the [Cooperatives—Patrons Subsection](https://asc.understandingaccounting.org/asc/905/10/#15-scope-and-scope-exceptions) of Section 905-10-15. Source downloaded (UTC): 2026-09-09T23:51:32.233Z to 2026-09-09T23:51:32.233Z Record version: sha256:8733a5b9282f737a59d8b513c8d389a6c03969845ca3df79aa1da0b9b132ef05 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-905-25: 25 Recognition [Read section](https://asc.understandingaccounting.org/asc/330/905/#25-recognition) SEC content: no #### Growing Crops ##### [330-905-25-1](https://asc.understandingaccounting.org/asc/330/905/#330-905-25-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:32.233Z to 2026-09-09T23:51:32.233Z Record version: sha256:158c0eaa3cde029977c332c204b85f1844b68ed15e9a3b1fb031ed0dede42f55 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. All direct and indirect costs of growing [crops](https://asc.understandingaccounting.org/glossary/c/#crops "Grains, vegetables, fruits, berries, nuts, and fibers grown by agricultural producers.") shall be accumulated until the time of harvest. Some crop costs, such as soil preparation, are incurred before planting and shall be deferred and allocated to the [growing crop](https://asc.understandingaccounting.org/glossary/g/#growing-crop "A field, row, tree, bush, or vine crop before harvest."). ##### [330-905-25-2](https://asc.understandingaccounting.org/asc/330/905/#330-905-25-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:32.233Z to 2026-09-09T23:51:32.233Z Record version: sha256:767b3ca0adb037990e93920f31bfb7b20daceab469322ac1686bdc38a8f447ec Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Other cultural practices, such as clearing the residue of harvested crops, cannot be performed or completed until after harvest, which may be in a succeeding year; those costs shall be estimated, accrued, and allocated to the [harvested crop](https://asc.understandingaccounting.org/glossary/h/#harvested-crop "An agricultural product, gathered but unsold."). Some crops require more than one year to mature, and the costs shall be deferred until harvest. #### Production Animals ##### [330-905-25-3](https://asc.understandingaccounting.org/asc/330/905/#330-905-25-3) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:32.233Z to 2026-09-09T23:51:32.233Z Record version: sha256:b2a0166725a3ed4f0b43b5081c35162fd1b6ecf1d8c4fd2b87dedbce80dc4d95 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Animals with short productive lives, such as poultry, may be classified as inventory. Due to the short productive life of poultry, the cost of flocks may be classified as inventory. The accounting principles for poultry operations are much the same as those for other [production animals](https://asc.understandingaccounting.org/glossary/p/#production-animals "Production animals provide a service or primary product other than their progeny. Examples are dairy cows (milk), poultry (meat and eggs), and sheep (meat and wool).") (see paragraph [905-360-25-4](https://asc.understandingaccounting.org/asc/360/905/#360-905-25-4)), although the operating cycles are much shorter. ##### [330-905-25-4](https://asc.understandingaccounting.org/asc/330/905/#330-905-25-4) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:32.233Z to 2026-09-09T23:51:32.233Z Record version: sha256:6d3b0f4e62a8782a37618125430458282414ac329be685f9f7293a6a4b11774d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. For guidance on developing animals and animals held for sale, breeding animals, and production animals, see Subtopic 905-360. ### Cooperatives ##### [330-905-25-5](https://asc.understandingaccounting.org/asc/330/905/#330-905-25-5) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:32.233Z to 2026-09-09T23:51:32.233Z Record version: sha256:c597175d357a9dd06069e394045d41f5bafd59d6e3c4a3ee2720525c209e2649 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If the boards of directors of agricultural marketing cooperatives operating on a pooling basis with no obligation to pay patrons fixed prices (pooling cooperatives) assign amounts that approximate estimated market to unprocessed products received from patrons, the assigned amounts are cost and shall be charged to cost of goods sold. ##### [330-905-25-6](https://asc.understandingaccounting.org/asc/330/905/#330-905-25-6) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:32.233Z to 2026-09-09T23:51:32.233Z Record version: sha256:b36699f7afd32b9719e5752ae709e7e9ad7a6724bc490449537de000b64ddaa9 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Pooling cooperatives may use [net realizable value](https://asc.understandingaccounting.org/glossary/n/#net-realizable-value "Estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation.") for determining pool proceeds, transferring inventory amounts to subsequent [pools](https://asc.understandingaccounting.org/glossary/p/#pools "Pools are accounting control centers used for determining earnings and patronage refunds due to particular patrons, including the following: An open pool is an accounting control center that is not closed at the end of each accounting period. Open pools are sometimes used by marketing cooperatives for crops that may not be sold for two or more years after their receipt from patrons. A single pool cooperative determines net proceeds or patronage refunds on the basis of overall operating results for all commodities marketed during an accounting period. A multiple pool cooperative determines net proceeds or patronage refunds on the basis of separate commodities, departments, or accounting periods."), or for other purposes (see column B in the table in Example 1 (paragraph [905-330-55-1](https://asc.understandingaccounting.org/asc/330/905/#330-905-55-1))). ##### [330-905-25-7](https://asc.understandingaccounting.org/asc/330/905/#330-905-25-7) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:32.233Z to 2026-09-09T23:51:32.233Z Record version: sha256:24479d098eb17cba4d80d2a8d59cb3ba367695875d267f184a0a54a69baf640b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If the boards of directors of pooling cooperatives do not assign amounts that approximate market to unprocessed products received from patrons, the cooperatives shall account for inventories at net realizable value (see column C in the table in Example 1 (paragraph [905-330-55-1](https://asc.understandingaccounting.org/asc/330/905/#330-905-55-1))). Because amounts that approximate estimated market are not assigned to products received from patrons, cost of goods sold will not include a charge for unprocessed products under this method. ##### [330-905-25-8](https://asc.understandingaccounting.org/asc/330/905/#330-905-25-8) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:32.233Z to 2026-09-09T23:51:32.233Z Record version: sha256:fa57e0696b3dd832a7f8d8585f0f6be2d795191d8f145bafb344d4ed2e74f568 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Pooling cooperatives shall not use the [cash advance method](https://asc.understandingaccounting.org/glossary/c/#cash-advance-method "The cash advance method is a prohibited method of accounting for inventories of a marketing cooperative operating on a pooling basis. Under this method, inventories are accounted for at the amount of cash advances made to patrons. (This is sometimes referred to as the cost advance method.)") to account for inventories. Source downloaded (UTC): 2026-09-09T23:51:35.402Z to 2026-09-09T23:51:35.402Z Record version: sha256:3b70e7887f705e7533f94ede92f554839b0159deeba389a9f5cd9dec69f8d4d2 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-905-30: 30 Initial Measurement [Read section](https://asc.understandingaccounting.org/asc/330/905/#30-initial-measurement) SEC content: no ##### [330-905-30-1](https://asc.understandingaccounting.org/asc/330/905/#330-905-30-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:35.402Z to 2026-09-09T23:51:35.402Z Record version: sha256:b3eb6a555c28725a838b479d5868fac35918c67e5a33fe11958c687ff0a07147 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Exceptional cases exist in which it is not practicable to determine an appropriate cost basis for products. A market basis is acceptable if the products meet all of the following criteria: 1. a They have immediate marketability at quoted market prices that cannot be influenced by the producer. 2. b They have characteristics of unit interchangeability. 3. c They have relatively insignificant costs of disposal. The accounting basis of those kinds of inventories shall be their realizable value, calculated on the basis of quoted market prices less estimated direct costs of disposal. An example is freshly dressed meats produced in meat packing operations. #### Harvested Crops ##### [330-905-30-2](https://asc.understandingaccounting.org/asc/330/905/#330-905-30-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:35.402Z to 2026-09-09T23:51:35.402Z Record version: sha256:e0141feeed622fb1904edce9c9ccea3b143fb0a04c89350da79c5aa273f3cfb5 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Generally, farming procedures undertaken after the current year harvest benefit the crop of the succeeding year. There may be instances, however, in which additional costs such as costs of special tillage, chopping, or burning are required after harvest of a particular crop to overcome a physical or noxious condition. Those costs shall be estimated and accrued as costs of the [harvested crop](https://asc.understandingaccounting.org/glossary/h/#harvested-crop "An agricultural product, gathered but unsold."). ### Cooperatives ##### [330-905-30-3](https://asc.understandingaccounting.org/asc/330/905/#330-905-30-3) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:35.402Z to 2026-09-09T23:51:35.402Z Record version: sha256:645e82e4f800f2d41a174dc3d01b6e0fc71e4f5484de2dcd7a51d28cfffda32e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Paragraph superseded by Accounting Standards Update No. 2014-09](https://asc.understandingaccounting.org/updates/asu-2014-09/). ##### [330-905-30-4](https://asc.understandingaccounting.org/asc/330/905/#330-905-30-4) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:35.402Z to 2026-09-09T23:51:35.402Z Record version: sha256:a38c438120dcf18f76617df62e1b5dabc702f66d1f5892a109cd240a10fa6963 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Agricultural cooperatives](https://asc.understandingaccounting.org/glossary/a/#agricultural-cooperative "The Agricultural Marketing Act of 1929 defines a cooperative association as any association in which farmers act together in processing, preparing for market, handling, and/or marketing the farm products of persons so engaged, and also means any association in which farmers act together in purchasing, testing, grading, processing, distributing, and/or furnishing farm supplies and/or farm business services. Provided, however, that such associations are operated for producers or purchasers and conform to one or both of the following requirements: No member of an agricultural cooperative association is allowed more than one vote because of the amount of stock or membership capital he may own therein. The association does not pay dividends on stock or membership capital in excess of 8 percent per year. In addition to meeting either of the requirements in this paragraph, the association shall not deal in farm products, farm supplies, and farm business services with or for nonmembers of an agricultural cooperative in an amount greater in value than the total amount of such business transacted by it with or for members. All business transacted by any cooperative association for or on behalf of the United States or any agency or instrumentality thereof shall be disregarded in determining the volume of member and nonmember business transacted by such association.") operating on a pooling basis may receive products from their patrons without paying a fixed price to the patrons. A cooperative may assign amounts to products on the basis of current prices paid by other buyers or on amounts established by the cooperative's board of directors, or it may assign no amount. Source downloaded (UTC): 2026-09-09T23:51:39.164Z to 2026-09-09T23:51:39.164Z Record version: sha256:1c6418cbe5b8a338147a7776f8d2b1c25706658781c879bbe740edbe29c4924c Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-905-35: 35 Subsequent Measurement [Read section](https://asc.understandingaccounting.org/asc/330/905/#35-subsequent-measurement) SEC content: no #### Growing Crops ##### [330-905-35-1](https://asc.understandingaccounting.org/asc/330/905/#330-905-35-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:39.164Z to 2026-09-09T23:51:39.164Z Record version: sha256:c62a21fa36adee4eea824e84695379f8bfd16c42de8050c31c53d48419be804c Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Costs of growing [crops](https://asc.understandingaccounting.org/glossary/c/#crops "Grains, vegetables, fruits, berries, nuts, and fibers grown by agricultural producers.") shall be accumulated until the time of harvest. Growing crops shall be measured using the guidance in Subtopic 330-10. #### Developing Animals ##### [330-905-35-2](https://asc.understandingaccounting.org/asc/330/905/#330-905-35-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:39.164Z to 2026-09-09T23:51:39.164Z Record version: sha256:682f834a8ac5c1910fcabecd59130c887e6bf22bb1ca421a4d3d924a8c5cb6bf Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Developing animals to be held for sale shall be measured using the guidance in Subtopic 330-10. #### Animals Available and Held for Sale ##### [330-905-35-3](https://asc.understandingaccounting.org/asc/330/905/#330-905-35-3) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:39.164Z to 2026-09-09T23:51:39.164Z Record version: sha256:519aadae8636cfdcd2a8ef53eea025cdd37b27968f0f23d4c71910e6ae5e7c73 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Animals held for sale shall be valued at either of the following: 1. a The amount determined using the measurement guidance in Subtopic 330-10 2. b [Net realizable value](https://asc.understandingaccounting.org/glossary/n/#net-realizable-value "Estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation."), if all the following conditions exist: 1. 1 The product has a reliable, readily determinable, and realizable market price. 2. 2 The product has relatively insignificant and predictable costs of disposal. 3. 3 The product is available for immediate delivery. #### Harvested Crops ##### [330-905-35-4](https://asc.understandingaccounting.org/asc/330/905/#330-905-35-4) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:39.164Z to 2026-09-09T23:51:39.164Z Record version: sha256:2baa4ba68ca820b41223931420f0faf13a5466bfe516cf4eac5a5fa71696649f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Inventories of harvested crops shall be valued using the same criteria as animals held for sale in the preceding paragraph. ### Cooperatives ##### [330-905-35-5](https://asc.understandingaccounting.org/asc/330/905/#330-905-35-5) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:39.164Z to 2026-09-09T23:51:39.164Z Record version: sha256:cc1b6fe39a76d17d053d7e2b9e4a0afec4ad35b78c49c219be7e0cd27f84fd2d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The inventories for a [pooling cooperative](https://asc.understandingaccounting.org/glossary/p/#pooling-cooperative "A marketing cooperative that receives its members' agricultural products without obligation to pay a fixed price and commingles those products into single or multiple pools for processing and marketing purposes. Pool periods may vary from a week to a year or longer, depending on the product involved. Generally profits or losses are allocated to patrons upon closing of the pool.") shall be accounted for at either of the following: 1. a The amount determined using the measurement guidance in Subtopic 330-10 2. b [Net realizable value](https://asc.understandingaccounting.org/glossary/n/#net-realizable-value "Estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation."). When [assigned amounts](https://asc.understandingaccounting.org/glossary/a/#assigned-amounts "Amounts used to record products delivered by patrons of a marketing cooperative operating on a pooling basis, and the related liability to patrons if the ultimate amounts to be paid to patrons are determined when the pool is closed. These amounts may be established on the basis of current prices paid by other buyers (sometimes referred to as field prices), or they may be established by the cooperative's board of directors. The assigned amounts are sometimes referred to as established values.") are used, they should approximate estimated net realizable value of unprocessed products delivered by patrons. See Example 1 (paragraph [905-330-55-1](https://asc.understandingaccounting.org/asc/330/905/#330-905-55-1)) for an illustration. Source downloaded (UTC): 2026-09-09T23:51:42.990Z to 2026-09-09T23:51:42.990Z Record version: sha256:1f7ed93e8c7ce510cfe7e2fa13610ba95a78d47f36b193ab07bbc3d1fc35c3d8 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-905-40: 40 Derecognition [Read section](https://asc.understandingaccounting.org/asc/330/905/#40-derecognition) SEC content: no ### Cooperatives—Patrons ##### [330-905-40-1](https://asc.understandingaccounting.org/asc/330/905/#330-905-40-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:42.990Z to 2026-09-09T23:51:42.990Z Record version: sha256:0268ac81bf684b33f535c85a7d65e0b5f99807c8b3884ae2f79ab1db825be09d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Paragraph superseded by Accounting Standards Update No. 2014-09](https://asc.understandingaccounting.org/updates/asu-2014-09/). Source downloaded (UTC): 2026-09-09T23:51:45.954Z to 2026-09-09T23:51:45.954Z Record version: sha256:19267d9e6ccd79aadbcae0b71c489f00720e8142a6f41612acd70d3fb1877893 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-905-50: 50 Disclosure [Read section](https://asc.understandingaccounting.org/asc/330/905/#50-disclosure) SEC content: no ### Cooperatives ##### [330-905-50-1](https://asc.understandingaccounting.org/asc/330/905/#330-905-50-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:45.954Z to 2026-09-09T23:51:45.954Z Record version: sha256:c564fbb8b5dcc409cb91cfeb0bce4e8c998d5e4f892ac5ea3e70852eb7a44c3d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The method used and the dollar amounts assigned to members' products shall be disclosed. Source downloaded (UTC): 2026-09-09T23:51:49.173Z to 2026-09-09T23:51:49.173Z Record version: sha256:5c897eda7689cb89c1e5882d40b499f0b4356e864c3902bfdd7007c00d80ad29 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-905-55: 55 Implementation Guidance and Illustrations [Read section](https://asc.understandingaccounting.org/asc/330/905/#55-implementation-guidance-and-illustrations) SEC content: no ### Cooperatives #### Illustrations ##### [330-905-55-1](https://asc.understandingaccounting.org/asc/330/905/#330-905-55-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:49.173Z to 2026-09-09T23:51:49.173Z Record version: sha256:3cf4cb6da63f057d0add5865c8bc72d826874eec13caae88125cfe21af3d2087 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Example illustrates the guidance in paragraphs [905-330-25-6 through 25-7](https://asc.understandingaccounting.org/asc/330/905/#330-905-25-6) and [905-330-35-5](https://asc.understandingaccounting.org/asc/330/905/#330-905-35-5). ##### [330-905-55-2](https://asc.understandingaccounting.org/asc/330/905/#330-905-55-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:49.173Z to 2026-09-09T23:51:49.173Z Record version: sha256:8fba49c4e36aa16b22481a6bbe372a89b324d6d390eb5a401abd3039b3245479 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. In this Example, inventory is measured using first-in, first-out (FIFO) and the following assumptions apply: - ![ ](https://asc.understandingaccounting.org/asc-img/GUID-D642F29C-99D4-4315-B7CE-16008A7CD7AD-low.gif) Sales " $129,630 " Beginning inventory Net realizable value " 31,128 " Lower of cost and net realizable value " 28,380 " Assigned value of patrons' raw product received " 56,500 " Ending inventory Net realizable value " 35,596 " Lower of cost and net realizable value " 32,360 " Income taxes " 1,250 " Other costs and expenses " 56,580 " "Amounts paid to patrons, retains, and nonpatronage earnings" " 74,430 " Amounts due patrons at beginning of year Lower of cost and net realizable value method " 8,910 " Net realizable value method " 11,748 " ##### [330-905-55-3](https://asc.understandingaccounting.org/asc/330/905/#330-905-55-3) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:49.173Z to 2026-09-09T23:51:49.173Z Record version: sha256:d417cf0e612cb7a9aa3278dee0fbbaf6bae05f184a1825222a1ba4b99479d1ae Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The following tables illustrate the statement of net earnings prepared under each of two possible methods of accounting for inventories (columns A and B), the statement of net proceeds prepared under the [net realizable value](https://asc.understandingaccounting.org/glossary/n/#net-realizable-value "Estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation.") method (column C), and the respective statements of amounts due patrons, if such latter statement is included in the financial statements. Column A demonstrates the lower of cost and net realizable value method with patrons' raw product being charged to cost of production at [assigned amounts](https://asc.understandingaccounting.org/glossary/a/#assigned-amounts "Amounts used to record products delivered by patrons of a marketing cooperative operating on a pooling basis, and the related liability to patrons if the ultimate amounts to be paid to patrons are determined when the pool is closed. These amounts may be established on the basis of current prices paid by other buyers (sometimes referred to as field prices), or they may be established by the cooperative's board of directors. The assigned amounts are sometimes referred to as established values."). Column B demonstrates the net realizable value method with patrons' raw product being charged to cost of production at assigned amounts. Column C demonstrates the net realizable value method when no amounts are assigned to patrons' raw product; therefore, there is no charge to cost of production for patrons' raw product. - ![ ](https://asc.understandingaccounting.org/asc-img/GUID-22A0FF8F-7F51-458D-AF8E-FFC80F529FEE-low.gif) Inventories Valued At Lower of Cost and Net Realizable Value (Column A) "Net Realizable Value (Column B)" "Net Realizable Value (Column C)" Sales " $129,630 " " $129,630 " " $129,630 " Costs and expenses (I) " 109,100 " " 108,702 " " 52,202 " Earnings before income taxes " 20,530 " " 20,928 " - Proceeds before income taxes - - " 77,428 " Income taxes " 1,250 " " 1,250 " " 1,250 " Net earnings " $19,280 " " $19,678 " Net proceeds " $76,178 " I. Beginning inventory " $28,380 " " $31,218 " " $31,218 " Assigned value of patrons' raw product received " 56,500 " " 56,500 " - Ending inventory " (32,360)" " (35,596)" " (35,596)" Other costs and expenses " 56,580 " " 56,580 " " 56,580 " " $109,100 " " $108,702 " " $52,202 " - ![ ](https://asc.understandingaccounting.org/asc-img/GUID-8D646031-1FE0-44AF-8DDC-9C2E944507DC-low.gif) Statement of Amounts Due Patrons Inventories Valued At Lower of Cost and Net Realizable Value (Column A) Net Realizable Value (Column B) Net Realizable Value (Column C) Amounts due patrons at beginning of year " $8,910 " " $11,748 " " $11,748 " Net earnings " 19,280 " " 19,678 " - Net proceeds - - " 76,178 " Assigned value of patrons' raw product received " 56,500 " " 56,500 " - " 84,690 " " 87,926 " " 87,926 " "Less amounts paid to patrons, retains, and nonpatronage earnings" " 74,430 " " 74,430 " " 74,430 " Amounts due patrons at end of year " $10,260 " " $13,496 " " $13,496 " ##### [330-905-55-4](https://asc.understandingaccounting.org/asc/330/905/#330-905-55-4) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:49.173Z to 2026-09-09T23:51:49.173Z Record version: sha256:1a64ad430af6db14a6b1287a10183fc8319351d8309bc8d0221526ef942ec2fc Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Under the two inventory methods presented, the difference in amounts due patrons at the end of the year results from the difference in the ending inventory valuations, illustrated as follows. - ![ ](https://asc.understandingaccounting.org/asc-img/GUID-E1F78FFB-2B5D-4D77-A389-3D89391CAA45-low.gif) Inventories of finished goods and goods in process at: Net realizable value " $35,596 " Lower of cost and net realizable value " (32,360)" " 3,326 " Amounts due patrons at end of year on lower of cost and net realizable value basis " 10,260 " Amounts due patrons at end of year on net realizable value basis " $13,496 " Source downloaded (UTC): 2026-09-09T23:51:55.917Z to 2026-09-09T23:52:13.368Z Record version: sha256:b135b7f4e8573c1ab40f253c9035b3b5cc38ca796be14df672e68c5c8a141cd2 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-908: Inventory — Airlines ### Machine-generated study aids ```json { "summary": "ASC 330-908 governs inventory accounting for airlines, where \"inventory\" consists of expendable spare parts, materials, and supplies held for internal consumption rather than sale. Expendable parts are recorded at cost in a current asset account akin to a prepaid expense, carry an allowance for obsolescence tied to the lives of the related fleets, and are charged to expense as used.", "key_points": [ "Airline inventories differ from the classic definition in Topic 330 because they are for internal consumption, not for sale, and consist primarily of expendable (spare) parts, materials, and supplies (330-908-05-2).", "Expendable parts are recorded at cost in a current asset account for spare parts and supplies, similar in nature to a prepaid expense (330-908-25-1).", "Reusable spare parts and supplies recovered from construction, maintenance, or retirement of property and equipment are included with expendable parts at the average cost of comparable items, based on condition and continuing utility (330-908-25-1).", "Materials and supplies held in small quantities and purchased as needed are charged to expense when purchased (330-908-25-1).", "Inventories are valued at cost (330-908-30-1) and must include an allowance for obsolescence corresponding to the lives of the related fleets (330-908-35-1).", "Expendable parts are charged to expense as they are used (330-908-40-1) and are classified as current assets (330-908-45-1); rotable parts and assemblies of significant value are addressed in 908-360-45-1." ], "categories": [ "Inventory and PP&E", "Industry-specific", "Subsequent measurement", "Initial measurement" ], "audience_level": "intermediate", "student_note": "The key trap is treating airline \"inventory\" like goods held for sale — it is really consumable spare parts accounted for like a prepaid expense at cost, with obsolescence allowances keyed to fleet lives. Also distinguish expendable parts (current assets under 330-908) from rotable parts and assemblies of significant value, which are addressed as property and equipment under 908-360.", "related_topics": [ "330-10", "908-10", "908-330", "908-360", "360-10" ], "key_concepts": [ "expendable spare parts", "materials and supplies", "allowance for obsolescence", "rotable parts", "cost valuation", "current asset classification", "internal consumption inventory", "airline industry" ] } ``` Source downloaded (UTC): 2026-09-09T23:51:55.917Z to 2026-09-09T23:51:55.917Z Record version: sha256:3a551ed9e808afc26c71de19362a0c94406f121bd389835c0532e51e778665cc Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-908-05: 05 Overview and Background [Read section](https://asc.understandingaccounting.org/asc/330/908/#05-overview-and-background) SEC content: no ##### [330-908-05-1](https://asc.understandingaccounting.org/asc/330/908/#330-908-05-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:55.917Z to 2026-09-09T23:51:55.917Z Record version: sha256:a242b038e52fbe6029f69e884f512a6c037aa594630ee903c7c13fc4556b4cf9 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic provides guidance for inventory accounting for entities in the airline industry. ##### [330-908-05-2](https://asc.understandingaccounting.org/asc/330/908/#330-908-05-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:55.917Z to 2026-09-09T23:51:55.917Z Record version: sha256:159f033d374d9cd01389f6bb7b3aceb545b2c7157a5324c82d5146cb2dd4eaa2 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The inventories in an airline operation (that is, carrier services for passengers and/or cargo) are for internal consumption and not for sale; they therefore differ substantially from the classical definition (see Topic 330). Inventories in an airline operation comprise primarily expendable (spare) parts and materials and supplies used in the airline's operation. Source downloaded (UTC): 2026-09-09T23:51:57.728Z to 2026-09-09T23:51:57.728Z Record version: sha256:73fbead827d045686158bc3ff2b8fcab4ac21b0bb5ef57b111ceb9cb6cf6bebe Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-908-15: 15 Scope and Scope Exceptions [Read section](https://asc.understandingaccounting.org/asc/330/908/#15-scope-and-scope-exceptions) SEC content: no #### Overall Guidance ##### [330-908-15-1](https://asc.understandingaccounting.org/asc/330/908/#330-908-15-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:51:57.728Z to 2026-09-09T23:51:57.728Z Record version: sha256:cdf73216dcdf2ad6adf0d08fe0d4e57ccc01249aba32775b515a8a50b1f1db75 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see Section 908-10-15. Source downloaded (UTC): 2026-09-09T23:52:01.526Z to 2026-09-09T23:52:01.526Z Record version: sha256:3a424b4ea18aef9e1dbf5f27f8e02001249430df997657fcb4c4f422859a4146 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-908-25: 25 Recognition [Read section](https://asc.understandingaccounting.org/asc/330/908/#25-recognition) SEC content: no ##### [330-908-25-1](https://asc.understandingaccounting.org/asc/330/908/#330-908-25-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:52:01.526Z to 2026-09-09T23:52:01.526Z Record version: sha256:ac08476eed0df129eaa67184891e0c5115def0b00f45176311deec2e2a8d1a79 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Expendable parts](https://asc.understandingaccounting.org/glossary/e/#expendable-parts "Parts that are ordinarily used up (consumed) and replaced with new parts, as opposed to those parts that are capable of being used over and over after being refurbished (rotable flight equipment).") shall be recorded at cost in a current asset account for [spare parts](https://asc.understandingaccounting.org/glossary/s/#spare-parts "Parts, appurtenances, and accessories of aircraft (other than aircraft engines and propellers), of aircraft engines (other than propellers), of propellers, or of appliances that are maintained for installation or use in an aircraft, aircraft engine, propeller, or appliance but that are not yet installed or attached.") and supplies, which is similar in nature to a prepaid expense. Reusable spare parts and supplies recovered in connection with construction, maintenance, or retirement of property and equipment shall be included with expendable parts at the average cost of comparable items. This valuation is typically based on the condition of the part or group of parts and their continuing utility. Materials and supplies held in small quantities and purchased as needed shall be charged to expense when they are purchased. ##### [330-908-25-2](https://asc.understandingaccounting.org/asc/330/908/#330-908-25-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:52:01.526Z to 2026-09-09T23:52:01.526Z Record version: sha256:baf198b497fa8d19f1b6ed8bf03caad72db040727a0220f729ec08975051d93b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See Section 908-330-30 for a summary of the recognition and initial measurement standards for airline inventories. Source downloaded (UTC): 2026-09-09T23:52:05.170Z to 2026-09-09T23:52:05.170Z Record version: sha256:435d2c4a9067b783ba3bf776d8aca67a475aa66d8aa3b2a7fc3e103bef043189 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-908-30: 30 Initial Measurement [Read section](https://asc.understandingaccounting.org/asc/330/908/#30-initial-measurement) SEC content: no ##### [330-908-30-1](https://asc.understandingaccounting.org/asc/330/908/#330-908-30-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:52:05.170Z to 2026-09-09T23:52:05.170Z Record version: sha256:3401f7ccb292c3f83e5d7a6c2ac461cb2278e628f380609247808f2041779732 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Inventories are valued at cost. Source downloaded (UTC): 2026-09-09T23:52:08.237Z to 2026-09-09T23:52:08.237Z Record version: sha256:6b9a46d5e086a9ddeb05287d98fba3e395feeac50acdccd2412aadeafbde3eb0 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-908-35: 35 Subsequent Measurement [Read section](https://asc.understandingaccounting.org/asc/330/908/#35-subsequent-measurement) SEC content: no ##### [330-908-35-1](https://asc.understandingaccounting.org/asc/330/908/#330-908-35-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:52:08.237Z to 2026-09-09T23:52:08.237Z Record version: sha256:c24eea6a492a4764d94685b49dba4d061cf626fc94837fe963240ab0f19af293 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Inventories shall include an allowance for obsolescence that corresponds to the lives of the related fleets. Source downloaded (UTC): 2026-09-09T23:52:11.681Z to 2026-09-09T23:52:11.681Z Record version: sha256:9ba0a454d7aa1f628b7231686f51193c5425f00238c5893026f621bd04be8132 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-908-40: 40 Derecognition [Read section](https://asc.understandingaccounting.org/asc/330/908/#40-derecognition) SEC content: no ##### [330-908-40-1](https://asc.understandingaccounting.org/asc/330/908/#330-908-40-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:52:11.681Z to 2026-09-09T23:52:11.681Z Record version: sha256:8853da9b10d21f66f031026ad1a0c721c097d072cee565158d7f9fee8347dd3a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Expendable parts](https://asc.understandingaccounting.org/glossary/e/#expendable-parts "Parts that are ordinarily used up (consumed) and replaced with new parts, as opposed to those parts that are capable of being used over and over after being refurbished (rotable flight equipment).") recorded in a current asset account for [spare parts](https://asc.understandingaccounting.org/glossary/s/#spare-parts "Parts, appurtenances, and accessories of aircraft (other than aircraft engines and propellers), of aircraft engines (other than propellers), of propellers, or of appliances that are maintained for installation or use in an aircraft, aircraft engine, propeller, or appliance but that are not yet installed or attached.") and supplies shall be charged to expense as they are used. Source downloaded (UTC): 2026-09-09T23:52:13.368Z to 2026-09-09T23:52:13.368Z Record version: sha256:dfe965d9fa18a4862feb7bda62566ae0d61a258bdefa94b02e0016fbc5d4166e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-908-45: 45 Other Presentation Matters [Read section](https://asc.understandingaccounting.org/asc/330/908/#45-other-presentation-matters) SEC content: no ##### [330-908-45-1](https://asc.understandingaccounting.org/asc/330/908/#330-908-45-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:52:13.368Z to 2026-09-09T23:52:13.368Z Record version: sha256:81994e9718e8a5142fd1631f365b90e555a5a426b68329c54363dc427a3adffc Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Expendable parts](https://asc.understandingaccounting.org/glossary/e/#expendable-parts "Parts that are ordinarily used up (consumed) and replaced with new parts, as opposed to those parts that are capable of being used over and over after being refurbished (rotable flight equipment).") are classified as current assets (see paragraph [908-360-45-1](https://asc.understandingaccounting.org/asc/360/908/#360-908-45-1) concerning [rotable parts](https://asc.understandingaccounting.org/glossary/r/#rotable-parts "Rotable parts are normally repaired and reused, as opposed to those parts that are consumed in the operations (expendable parts).") and assemblies of significant value). Source downloaded (UTC): 2026-09-09T23:52:16.516Z to 2026-09-09T23:52:29.423Z Record version: sha256:1e54b242e2b2526874fc1090160ebe5ab00bd51f98a11b37fe31f33a4960c103 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-910: Inventory — Contractors—Construction ### Machine-generated study aids ```json { "summary": "ASC 330-910 was the inventory guidance specific to construction contractors, addressing how contractors accounted for inventoried costs (e.g., uninstalled materials and precontract costs) under Topic 330. All of its substantive paragraphs — Sections 05 (Overview and Background), 15 (Scope), 25 (Recognition), and 40 (Derecognition) — were superseded by Maintenance Update No. 2019-01, so the subtopic contains no operative guidance. Contractors now look to the general inventory guidance in Topic 330 and to the revenue and contract cost guidance in Topics 606 and 340-40.", "key_points": [ "Every paragraph of this subtopic (330-910-05-1, 330-910-15-1, 330-910-25-1, and 330-910-40-1) states 'Paragraph superseded by Maintenance Update No. 2019-01.'", "Because the subtopic is fully superseded, it imposes no recognition, measurement, or derecognition requirements and should not be cited as authoritative support.", "Industry-specific inventory guidance for construction contractors was removed as part of the codification cleanup that followed adoption of Topic 606 and Subtopic 340-40 on revenue and contract costs.", "Construction contractors apply the general inventory guidance in Topic 330 to inventoried materials and supplies.", "Costs of obtaining and fulfilling contracts with customers (including precontract and uninstalled materials costs) are addressed under Subtopic 340-40 and Topic 606 rather than under 330-910." ], "categories": [ "Inventory and PP&E", "Industry-specific", "Transition and effective dates" ], "audience_level": "intermediate", "student_note": "The only thing to know here is that this subtopic is empty — Maintenance Update No. 2019-01 wiped out all four paragraphs. Students sometimes cite legacy contractor inventory rules from 330-910 (or old Topic 605-35 concepts); today the answer lies in Topic 330 generally plus Topic 606 and Subtopic 340-40 for contract costs.", "related_topics": [ "330", "340-40", "606", "910", "605-35" ], "key_concepts": [ "superseded guidance", "construction contractor inventory", "industry-specific guidance", "contract costs", "uninstalled materials", "codification cleanup" ] } ``` Source downloaded (UTC): 2026-09-09T23:52:16.516Z to 2026-09-09T23:52:16.516Z Record version: sha256:de3e9dff17e5640ac92377fb03bc5385952fe007a9096e9e12b37748ccc76e3a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-910-00: 00 Status [Read section](https://asc.understandingaccounting.org/asc/330/910/#00-status) SEC content: no ##### [330-910-00-1](https://asc.understandingaccounting.org/asc/330/910/#330-910-00-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:52:16.516Z to 2026-09-09T23:52:16.516Z Record version: sha256:95bda3ad795a0fc6a82ed6a30a6ad09b8713a90adacd80da575fba03d6b35c70 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The following table identifies the changes made to this Subtopic.
ParagraphActionAccounting Standards UpdateDate
910-330-05-1SupersededMaintenance Update No. 2019-01 (PDF)01/08/2019
910-330-15-1SupersededMaintenance Update No. 2019-01 (PDF)01/08/2019
910-330-25-1SupersededMaintenance Update No. 2019-01 (PDF)01/08/2019
910-330-40-1SupersededMaintenance Update No. 2019-01 (PDF)01/08/2019
Source downloaded (UTC): 2026-09-09T23:52:19.708Z to 2026-09-09T23:52:19.708Z Record version: sha256:5831a5fc371c094937f1b6d1acad9576d6d9c5bb7dde93afeaa04fd6bfdc2fec Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-910-05: 05 Overview and Background [Read section](https://asc.understandingaccounting.org/asc/330/910/#05-overview-and-background) SEC content: no ##### [330-910-05-1](https://asc.understandingaccounting.org/asc/330/910/#330-910-05-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:52:19.708Z to 2026-09-09T23:52:19.708Z Record version: sha256:67f123f33baf59bb69b844a14b4943d75b0ab1266e06b0e978a6685d75c6821e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Paragraph superseded by Maintenance Update No. 2019-01.](https://asc.understandingaccounting.org/updates/maintenance-updates-2019/) Source downloaded (UTC): 2026-09-09T23:52:23.685Z to 2026-09-09T23:52:23.685Z Record version: sha256:9644f85f20244c1011e7bfc4187d8a123597f07c2007d96a5b9ec2dba1c045cc Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-910-15: 15 Scope and Scope Exceptions [Read section](https://asc.understandingaccounting.org/asc/330/910/#15-scope-and-scope-exceptions) SEC content: no ##### [330-910-15-1](https://asc.understandingaccounting.org/asc/330/910/#330-910-15-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:52:23.685Z to 2026-09-09T23:52:23.685Z Record version: sha256:82d81f600d963b2d5550abab86fd5fdef8b362c5daa79ab6143bf9344a19e281 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Paragraph superseded by Maintenance Update No. 2019-01.](https://asc.understandingaccounting.org/updates/maintenance-updates-2019/) Source downloaded (UTC): 2026-09-09T23:52:25.574Z to 2026-09-09T23:52:25.574Z Record version: sha256:c11173109b612e8876ee8e0ba527cc907ac7efdeba24dd6792df469ed9edcf5b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-910-25: 25 Recognition [Read section](https://asc.understandingaccounting.org/asc/330/910/#25-recognition) SEC content: no ##### [330-910-25-1](https://asc.understandingaccounting.org/asc/330/910/#330-910-25-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:52:25.574Z to 2026-09-09T23:52:25.574Z Record version: sha256:f93e8996c35ce6aa0e95ff7e052ea9434bce213c60b802d7a4d8bced7f876588 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Paragraph superseded by Maintenance Update No. 2019-01.](https://asc.understandingaccounting.org/updates/maintenance-updates-2019/) Source downloaded (UTC): 2026-09-09T23:52:29.423Z to 2026-09-09T23:52:29.423Z Record version: sha256:05cbd2c66b85fdbe13b12b736c0ae0963a93c7c29c383618f9e81b28c1bf1b53 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-910-40: 40 Derecognition [Read section](https://asc.understandingaccounting.org/asc/330/910/#40-derecognition) SEC content: no ##### [330-910-40-1](https://asc.understandingaccounting.org/asc/330/910/#330-910-40-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:52:29.423Z to 2026-09-09T23:52:29.423Z Record version: sha256:9713a52d362b020c1c620b7d1b2fb04f0e3e3cf89088720ae3b7bb7d89e46e7d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Paragraph superseded by Maintenance Update No. 2019-01.](https://asc.understandingaccounting.org/updates/maintenance-updates-2019/) Source downloaded (UTC): 2026-09-09T23:52:31.116Z to 2026-09-09T23:52:45.444Z Record version: sha256:413e4508403bd61b5a15dfed79dcdef221632f91196cf0f610f0058741596b15 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-912: Inventory — Contractors—Federal Government ### Machine-generated study aids ```json { "summary": "This Subtopic gives government contractors narrow guidance on inventory affected by contracts terminated for the convenience of the government, plus disclosure of the accounting policy for costs included in contract inventory. If inventory whose costs are in the termination claim is later reacquired by the contractor, the reacquisition value is recorded as a purchase; in \"no-cost settlements,\" where the contractor waives its claim, no sale transaction arises and retained inventory is accounted for under ordinary inventory methods rather than as a purchase.", "key_points": [ "This Subtopic addresses inventory reacquired in a contract termination for the convenience of the government and the costs included in contract inventory (330-912-05-1).", "Scope follows Section 912-10-15, the Overall Subtopic for federal government contractors (330-912-15-1).", "Inventory items whose costs are included in a termination claim and later reacquired by the contractor are recorded at reacquisition value as a purchase, applied per paragraph 912-310-35-1 (330-912-25-1).", "In no-cost settlements, where the contractor waives its right to make a claim, there is no transaction to reflect in sales; contract costs keep their usual classification and retained inventory is accounted for under normal inventory methods and standards, not as a purchase (330-912-25-2).", "Guidance on inventory retained or sold to outsiders relating to contracts terminated for the government's convenience is in paragraphs 912-310-25-4 through 25-5 (330-912-25-3).", "A contractor must disclose its accounting policies with respect to costs included in inventory (330-912-50-1)." ], "categories": [ "Industry-specific", "Recognition", "Disclosure", "Inventory and PP&E" ], "audience_level": "intermediate", "student_note": "Tested point: reacquisition of inventory covered by a termination claim is a purchase, but inventory retained in a no-cost settlement is not — students often incorrectly record a sale or purchase in the no-cost case when no transaction has occurred.", "related_topics": [ "912-10", "912-310", "330-10", "912-20", "912-405" ], "key_concepts": [ "contract termination for convenience of the government", "termination claim", "reacquired inventory", "no-cost settlement", "contract inventory", "inventory accounting policy disclosure", "government contractor" ] } ``` Source downloaded (UTC): 2026-09-09T23:52:31.116Z to 2026-09-09T23:52:31.116Z Record version: sha256:286aae253154c5ba146bb97dbeae758585a0ebdc4addfd48fe8e02b6cf0a695d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-912-00: 00 Status [Read section](https://asc.understandingaccounting.org/asc/330/912/#00-status) SEC content: no ##### [330-912-00-1](https://asc.understandingaccounting.org/asc/330/912/#330-912-00-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:52:31.116Z to 2026-09-09T23:52:31.116Z Record version: sha256:7839d04d0573e966c77cc6aa797d3158672349664f29feaae7ae652a6100c077 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. No updates have been made to this subtopic. Source downloaded (UTC): 2026-09-09T23:52:34.600Z to 2026-09-09T23:52:34.600Z Record version: sha256:7ea1d0d36c523c313bea16d61584247a634b50ffcf69e5509e2c23402aa9d56b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-912-05: 05 Overview and Background [Read section](https://asc.understandingaccounting.org/asc/330/912/#05-overview-and-background) SEC content: no ##### [330-912-05-1](https://asc.understandingaccounting.org/asc/330/912/#330-912-05-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:52:34.600Z to 2026-09-09T23:52:34.600Z Record version: sha256:ad04e017d29d7a50137479b746d924929f54d9eba99db6b0b6df653e1f44a013 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic provides guidance to government contractors related to inventory reacquired in a contract termination for the convenience of the government and the costs included in contract inventory. Source downloaded (UTC): 2026-09-09T23:52:36.831Z to 2026-09-09T23:52:36.831Z Record version: sha256:930cb81cb854dce8fb954721643d17528aba7ca1c6358f0c0237b3583b152c89 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-912-15: 15 Scope and Scope Exceptions [Read section](https://asc.understandingaccounting.org/asc/330/912/#15-scope-and-scope-exceptions) SEC content: no #### Overall Guidance ##### [330-912-15-1](https://asc.understandingaccounting.org/asc/330/912/#330-912-15-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:52:36.831Z to 2026-09-09T23:52:36.831Z Record version: sha256:50fb86aa2c3ac4ae96a1a69cda898463184174f61b1fae2d494c5a46740eb7a3 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see Section 912-10-15. Source downloaded (UTC): 2026-09-09T23:52:39.099Z to 2026-09-09T23:52:39.099Z Record version: sha256:8c13c65443fa04fb4623916853e41190b19b6cb912a49c44d2624a68a751b252 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-912-25: 25 Recognition [Read section](https://asc.understandingaccounting.org/asc/330/912/#25-recognition) SEC content: no #### Termination Claims ##### [330-912-25-1](https://asc.understandingaccounting.org/asc/330/912/#330-912-25-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:52:39.099Z to 2026-09-09T23:52:39.099Z Record version: sha256:3156b695523e7af076da69e0c95833114916e7dbb61c81d784449a067d4e471a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If inventory items whose costs are included in the termination claim are subsequently reacquired by the contractor the reacquisition value of those items shall be recorded as a purchase and applied in accordance with the guidance in paragraph [912-310-35-1](https://asc.understandingaccounting.org/asc/310/912/#310-912-35-1). ##### [330-912-25-2](https://asc.understandingaccounting.org/asc/330/912/#330-912-25-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:52:39.099Z to 2026-09-09T23:52:39.099Z Record version: sha256:372872e74a90d0005c1d761d12342e27a5648d9202de73b1b88bf0cad1d8c868 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. So called no-cost settlements—those in which the contractor waives the right to make a claim—result in no transaction that could be reflected in sales. The costs applicable to the contract shall be given their usual classification. The inventory retained shall not be treated as a purchase but shall be accounted for according to the usual methods and standards applicable to inventories. ##### [330-912-25-3](https://asc.understandingaccounting.org/asc/330/912/#330-912-25-3) Pending content: no Source downloaded (UTC): 2026-09-09T23:52:39.099Z to 2026-09-09T23:52:39.099Z Record version: sha256:512406db431bea2971e0ace640443a6d54cfdf93c2d5ff6295e41e5a81bda05c Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. For a discussion of inventory retained or sold to outsiders that relates to terminated contracts for the convenience of the government, see paragraphs [912-310-25-4 through 25-5](https://asc.understandingaccounting.org/asc/310/912/#310-912-25-4) . Source downloaded (UTC): 2026-09-09T23:52:41.951Z to 2026-09-09T23:52:41.951Z Record version: sha256:706cc4b19a2d8ab61d15ef2a73644e64d0eea73cbb33e9794753caf88874ab58 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-912-50: 50 Disclosure [Read section](https://asc.understandingaccounting.org/asc/330/912/#50-disclosure) SEC content: no #### Contract Inventory ##### [330-912-50-1](https://asc.understandingaccounting.org/asc/330/912/#330-912-50-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:52:41.951Z to 2026-09-09T23:52:41.951Z Record version: sha256:831ac944e5353c652a08a2e0672f9dff8be579dfc98240770870e932b542cdda Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A contractor's accounting policies with respect to costs included in inventory shall be disclosed. Source downloaded (UTC): 2026-09-09T23:52:47.274Z to 2026-09-09T23:52:53.935Z Record version: sha256:f71f7cbb88d07771a30b635529921e415bb4572b11fbf0d46fd8e638c6ce262d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-926: Inventory — Entertainment—Films ### Machine-generated study aids ```json { "summary": "This subtopic applies inventory accounting to film production and distribution entities that hold physical products for sale, such as videocassettes and digital video discs. Its core rule is that at each balance sheet date the entity must evaluate these product inventories for net realizable value and obsolescence exposure and record appropriate adjustments (330-926-35-1). Scope follows the Entertainment—Films Overall Subtopic scope in Section 926-10-15.", "key_points": [ "The Subtopic covers accounting for inventories of tangible products, such as videocassettes and video discs, carried by film production and distribution entities (330-926-05-1).", "Scope and scope exceptions are the same as those in the Entertainment—Films Overall Subtopic, Section 926-10-15 (330-926-15-1).", "At each balance sheet date, inventories of products held for sale must be evaluated for net realizable value and for obsolescence exposures (330-926-35-1).", "Adjustments must be recorded as necessary based on that evaluation (330-926-35-1)." ], "categories": [ "Subsequent measurement", "Inventory and PP&E", "Industry-specific", "Impairment" ], "audience_level": "intermediate", "student_note": "This is a short industry-specific overlay: it tells you that a film entity's physical media inventory is measured like ordinary inventory (NRV plus obsolescence), not under the film cost capitalization and amortization model. The common confusion is mixing up film costs (capitalized under 926-20) with videocassette/DVD product inventory held for sale, which is governed here and by ASC 330.", "related_topics": [ "330-10", "926-10", "926-20", "926-605" ], "key_concepts": [ "inventories of products held for sale", "net realizable value", "obsolescence exposure", "balance sheet date evaluation", "film distribution", "physical media inventory" ] } ``` Source downloaded (UTC): 2026-09-09T23:52:47.274Z to 2026-09-09T23:52:47.274Z Record version: sha256:1ac005565602fb7480aaede3efa0b43a176eae9ebd1d8e273bcc1328bfe7b3e0 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-926-05: 05 Overview and Background [Read section](https://asc.understandingaccounting.org/asc/330/926/#05-overview-and-background) SEC content: no ##### [330-926-05-1](https://asc.understandingaccounting.org/asc/330/926/#330-926-05-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:52:47.274Z to 2026-09-09T23:52:47.274Z Record version: sha256:bafdc31fbe1eb7974c9a2f3d789c4e443414d465f82c810baca5c4666b9323c6 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic presents accounting standards for entities in the film production and distribution industry that carry inventories of products such as videocassettes and video discs. Source downloaded (UTC): 2026-09-09T23:52:50.157Z to 2026-09-09T23:52:50.157Z Record version: sha256:e5ae2fe4135e50e0ff31589127e624a614d9a46add64e25c3833b987a6cb4347 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-926-15: 15 Scope and Scope Exceptions [Read section](https://asc.understandingaccounting.org/asc/330/926/#15-scope-and-scope-exceptions) SEC content: no #### Overall Guidance ##### [330-926-15-1](https://asc.understandingaccounting.org/asc/330/926/#330-926-15-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:52:50.157Z to 2026-09-09T23:52:50.157Z Record version: sha256:804fb633fd3f5b9d8ad88926a986c521dbef69b387b875861885d79ccbbf779c Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see Section 926-10-15. Source downloaded (UTC): 2026-09-09T23:52:53.935Z to 2026-09-09T23:52:53.935Z Record version: sha256:c04f4a9d1151928b255033953813c8e0f7530bda2ab1edf6b303c3c6419fe20a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-926-35: 35 Subsequent Measurement [Read section](https://asc.understandingaccounting.org/asc/330/926/#35-subsequent-measurement) SEC content: no #### Products Held for Sale ##### [330-926-35-1](https://asc.understandingaccounting.org/asc/330/926/#330-926-35-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:52:53.935Z to 2026-09-09T23:52:53.935Z Record version: sha256:14cd64aa4aad9fb377bdb21d075fdd2dd6b6f475a6d8b21f4d700ab8d95ce0e2 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. An entity shall, at each balance sheet date, evaluate inventories of products held for sale, such as videocassettes and digital video discs, for net realizable value and obsolescence exposures, with appropriate adjustments recorded as necessary. Source downloaded (UTC): 2026-09-09T23:52:57.013Z to 2026-09-09T23:53:06.919Z Record version: sha256:ff60c683e895d00c3e27e6e20e6eb8aade999dd6c473911b81d8951e4c4ecc50 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-930: Inventory — Extractive Activities—Mining ### Machine-generated study aids ```json { "summary": "This subtopic governs how mining entities account for stripping costs — the costs of removing overburden and waste materials to access ore — incurred during the production phase of a mine. The core rule is that post-production-phase stripping costs are variable production costs that must be capitalized into the cost of the inventory (ore) extracted in the same period the stripping costs are incurred. Stripping costs incurred before the production phase (i.e., during development) are outside the scope of this subtopic.", "key_points": [ "This Subtopic addresses accounting for stripping costs incurred in the production phase of mining operations (330-930-05-1).", "Stripping costs incurred during the production phase are variable production costs that should be included in the costs of the inventory produced (extracted) during the period the stripping costs are incurred (330-930-25-1).", "The guidance does not apply to stripping costs incurred before the production phase (330-930-15-2(a)).", "Scope otherwise follows the Extractive Activities—Mining Overall Subtopic scope in Section 930-10-15 (330-930-15-1).", "Because the costs attach to inventory extracted in the same period, they cannot be deferred and amortized over the mine's life or over future periods benefited." ], "categories": [ "Inventory and PP&E", "Initial measurement", "Industry-specific", "Recognition" ], "audience_level": "intermediate", "student_note": "The exam trap is timing: only production-phase stripping costs are inventoriable under this subtopic, and they hit inventory in the period incurred — students often wrongly assume stripping costs can be capitalized as a long-lived asset and amortized over the ore body's life. Identify whether the mine has reached the production phase before applying the rule.", "related_topics": [ "930-10", "930-330", "330-10", "930-805", "360-10" ], "key_concepts": [ "stripping costs", "production phase", "variable production costs", "inventory costing", "overburden removal", "mining operations", "development phase costs" ] } ``` Source downloaded (UTC): 2026-09-09T23:52:57.013Z to 2026-09-09T23:52:57.013Z Record version: sha256:8675b71e03ec124b559775965252341b9b28f2293cc7093609b07dc896229a47 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-930-05: 05 Overview and Background [Read section](https://asc.understandingaccounting.org/asc/330/930/#05-overview-and-background) SEC content: no ##### [330-930-05-1](https://asc.understandingaccounting.org/asc/330/930/#330-930-05-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:52:57.013Z to 2026-09-09T23:52:57.013Z Record version: sha256:8bf252fa0b555c8b8f819faf729f664a61bfe1eb93a1d803ab64167c3e7eb014 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic addresses the accounting for [stripping costs](https://asc.understandingaccounting.org/glossary/s/#stripping-costs "Stripping costs are costs incurred for the removal of overburden or waste materials for the purpose of obtaining access to an ore body that will be commercially produced.") incurred in the [production phase](https://asc.understandingaccounting.org/glossary/p/#production-phase "The production phase of a mine is deemed to begin when saleable minerals are extracted (produced) from an ore body, regardless of the level of production. However, the production phase does not commence with the removal of de minimis saleable mineral material that occurs in conjunction with the removal of overburden or waste material for the purpose of obtaining access to an ore body.") of mining operations. Source downloaded (UTC): 2026-09-09T23:52:59.931Z to 2026-09-09T23:52:59.931Z Record version: sha256:1b200f40bae934c4d25c136added14b26f9b7b454b746c845473bc5d49b10c37 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-930-15: 15 Scope and Scope Exceptions [Read section](https://asc.understandingaccounting.org/asc/330/930/#15-scope-and-scope-exceptions) SEC content: no #### Overall Guidance ##### [330-930-15-1](https://asc.understandingaccounting.org/asc/330/930/#330-930-15-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:52:59.931Z to 2026-09-09T23:52:59.931Z Record version: sha256:593f92180efe485d481c4cea1436b3b24867aff1a0b88b354f4f873e5a56df46 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see Section 930-10-15, with specific transaction exceptions noted below. #### Transactions ##### [330-930-15-2](https://asc.understandingaccounting.org/asc/330/930/#330-930-15-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:52:59.931Z to 2026-09-09T23:52:59.931Z Record version: sha256:524a24dc3d484a1172595496082fc3bc69ba8efa86ae0ecff6e663619f1d8f5f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The guidance in this Subtopic does not apply to the following transactions: 1. a [Stripping costs](https://asc.understandingaccounting.org/glossary/s/#stripping-costs "Stripping costs are costs incurred for the removal of overburden or waste materials for the purpose of obtaining access to an ore body that will be commercially produced.") incurred before the [production phase](https://asc.understandingaccounting.org/glossary/p/#production-phase "The production phase of a mine is deemed to begin when saleable minerals are extracted (produced) from an ore body, regardless of the level of production. However, the production phase does not commence with the removal of de minimis saleable mineral material that occurs in conjunction with the removal of overburden or waste material for the purpose of obtaining access to an ore body."). Source downloaded (UTC): 2026-09-09T23:53:06.919Z to 2026-09-09T23:53:06.919Z Record version: sha256:cca7032905310bffbfc076d928e30003c41dd41d380484e27ed37383306d0b39 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-930-25: 25 Recognition [Read section](https://asc.understandingaccounting.org/asc/330/930/#25-recognition) SEC content: no #### Production Phase Stripping Costs ##### [330-930-25-1](https://asc.understandingaccounting.org/asc/330/930/#330-930-25-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:06.919Z to 2026-09-09T23:53:06.919Z Record version: sha256:cde2906dc824cbeeaf897a99f037104cf3744da5589fe47e9c8faec156ee2e61 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Stripping costs](https://asc.understandingaccounting.org/glossary/s/#stripping-costs "Stripping costs are costs incurred for the removal of overburden or waste materials for the purpose of obtaining access to an ore body that will be commercially produced.") incurred during the [production phase](https://asc.understandingaccounting.org/glossary/p/#production-phase "The production phase of a mine is deemed to begin when saleable minerals are extracted (produced) from an ore body, regardless of the level of production. However, the production phase does not commence with the removal of de minimis saleable mineral material that occurs in conjunction with the removal of overburden or waste material for the purpose of obtaining access to an ore body.") of a mine are variable production costs that should be included in the costs of the inventory produced (that is, extracted) during the period that the stripping costs are incurred. Source downloaded (UTC): 2026-09-09T23:53:09.584Z to 2026-09-09T23:53:22.955Z Record version: sha256:89d4a9bc4287327809b47666c8a2715632b79cbf1cfc5ceb028f40cb0284463e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-932: Inventory — Extractive Activities—Oil and Gas ### Machine-generated study aids ```json { "summary": "This Subtopic governs inventory accounting for entities in the oil and gas (extractive activities) industry, borrowing the scope of ASC 932-10-15. Its core rules are prohibitions: energy trading contracts that are not derivatives under Topic 815 may not be subsequently measured at fair value through earnings, and physical inventories may not be measured at fair value unless another Topic permits it. Exchanges (buying and selling inventory with the same counterparty) are directed to ASC 845-10-15-5 through 15-9.", "key_points": [ "The Subtopic addresses accounting for inventory in the oil and gas industry (330-932-05-1) and adopts the scope of Section 932-10-15 (330-932-15-1).", "Energy trading contracts that do not qualify as derivatives under Topic 815 shall not be subsequently measured at fair value through earnings (330-932-35-1).", "Entities shall not measure physical inventories at fair value except as provided by guidance in other Topics (330-932-35-1).", "For inventory exchanges — buying and selling inventory with the same counterparty — apply paragraphs 845-10-15-5 through 15-9 (330-932-35-2)." ], "categories": [ "Subsequent measurement", "Industry-specific", "Inventory and PP&E", "Fair value" ], "audience_level": "intermediate", "student_note": "The takeaway is that oil and gas companies cannot mark physical inventories or non-derivative energy trading contracts to market through earnings — a rule that reversed earlier trading-book practice. Students often wrongly assume commodity inventories in energy are always fair-valued; fair value applies only where another Topic (e.g., 815 for true derivatives) allows it.", "related_topics": [ "932-10", "815", "845-10", "330-10", "932-360" ], "key_concepts": [ "energy trading contracts", "physical inventory", "fair value measurement prohibition", "inventory exchanges with same counterparty", "oil and gas extractive activities", "nonmonetary transactions" ] } ``` Source downloaded (UTC): 2026-09-09T23:53:09.584Z to 2026-09-09T23:53:09.584Z Record version: sha256:903befeb8673be97709a1b07b2c2074fb78aa8030aba4027f39a8dd622e00fbc Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-932-00: 00 Status [Read section](https://asc.understandingaccounting.org/asc/330/932/#00-status) SEC content: no ##### [330-932-00-1](https://asc.understandingaccounting.org/asc/330/932/#330-932-00-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:09.584Z to 2026-09-09T23:53:09.584Z Record version: sha256:8a867962c533363ca0f738e762617486d2e6b11245671f3aef8d51b5f96338e2 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The following table identifies the changes made to this Subtopic.
ParagraphActionAccounting Standards UpdateDate
932-330-35-1AmendedAccounting Standards Update No. 2016-1912/14/2016
932-330-35-1AmendedAccounting Standards Update No. 2012-0410/01/2012
Source downloaded (UTC): 2026-09-09T23:53:12.697Z to 2026-09-09T23:53:12.697Z Record version: sha256:b3bbac48ba1261de608be9abfac483bd43519b6fe0ab50f8a3f37090b0e1527b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-932-05: 05 Overview and Background [Read section](https://asc.understandingaccounting.org/asc/330/932/#05-overview-and-background) SEC content: no ##### [330-932-05-1](https://asc.understandingaccounting.org/asc/330/932/#330-932-05-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:12.697Z to 2026-09-09T23:53:12.697Z Record version: sha256:c89252ba6f12f077c8d1a5c2a97f2b851fd116e8c2245f59bc7acbd6e873319f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic addresses accounting for inventory in the oil and gas industry. Source downloaded (UTC): 2026-09-09T23:53:16.760Z to 2026-09-09T23:53:16.760Z Record version: sha256:84e98371588a13d716895bf59d910caf1633471131861c87880ad5356493618a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-932-15: 15 Scope and Scope Exceptions [Read section](https://asc.understandingaccounting.org/asc/330/932/#15-scope-and-scope-exceptions) SEC content: no #### Overall Guidance ##### [330-932-15-1](https://asc.understandingaccounting.org/asc/330/932/#330-932-15-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:16.760Z to 2026-09-09T23:53:16.760Z Record version: sha256:b6f848b7880f6153c19368f3a77ee1c60d514d46b6a645da30dfdfa86a6dae47 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see Section 932-10-15. Source downloaded (UTC): 2026-09-09T23:53:19.048Z to 2026-09-09T23:53:19.048Z Record version: sha256:8119dee9f77d3c62f365475a994719d92ffa4f3e6df20ebd6290d8de277ee90b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-932-35: 35 Subsequent Measurement [Read section](https://asc.understandingaccounting.org/asc/330/932/#35-subsequent-measurement) SEC content: no ##### [330-932-35-1](https://asc.understandingaccounting.org/asc/330/932/#330-932-35-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:19.048Z to 2026-09-09T23:53:19.048Z Record version: sha256:a9b17d593c83322638970c85cc2707f122658bdd810120001ea4db0bc35c5290 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Energy trading contracts that are not accounted for as derivatives in accordance with Topic 815 on derivatives and hedging shall not be measured subsequently at fair value through earnings. Entities shall not measure physical inventories at fair value, except as provided by guidance in other Topics. #### Exchanges of Inventory ##### [330-932-35-2](https://asc.understandingaccounting.org/asc/330/932/#330-932-35-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:19.048Z to 2026-09-09T23:53:19.048Z Record version: sha256:a617c453c7aea8516a5585ae602e4f501a76d723bd459c00c224ef9724fbc42c Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. For exchanges of inventories, the buying and selling of inventory with the same counterparty, see paragraphs [845-10-15-5 through 15-9](https://asc.understandingaccounting.org/asc/845/10/#845-10-15-5) . Source downloaded (UTC): 2026-09-09T23:53:24.824Z to 2026-09-09T23:53:33.731Z Record version: sha256:34ef1caf7437bd16a1da2005f3eaff9bb82a867f141c8adb9d6b47b440a40f56 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-976: Inventory — Real Estate—Retail Land ### Machine-generated study aids ```json { "summary": "This Subtopic sets the inventory-related disclosure requirements for entities engaged in retail land sales operations, focusing on future expenditures for land improvements. Entities must disclose the estimated total costs and timing of improvement expenditures for major selling areas for each of the five years after the balance sheet date, plus any recorded obligations for improvements (330-976-50-1).", "key_points": [ "The Subtopic provides only disclosure guidance concerning expenditures for improvements by entities with retail land sales operations (330-976-05-1).", "Its scope is the same as the Overall Real Estate—Retail Land Subtopic, Section 976-10-15 (330-976-15-1).", "Entities must disclose estimated total costs and estimated dates of expenditures for improvements for major areas from which sales are being made, for each of the five years following the financial statement date (330-976-50-1(a)).", "Entities must also disclose recorded obligations for improvements (330-976-50-1(b))." ], "categories": [ "Disclosure", "Inventory and PP&E", "Industry-specific" ], "audience_level": "intermediate", "student_note": "Remember this is a pure disclosure Subtopic\\u2014it does not tell you how to measure or capitalize improvement costs (that comes from ASC 976-360 and ASC 970); students often mistake the five-year schedule for a recognition rule when it is only a forward-looking cost-and-timing disclosure.", "related_topics": [ "976-10", "976-360", "976-605", "970", "330-10" ], "key_concepts": [ "retail land sales", "improvement expenditures", "estimated total costs", "recorded obligations", "real estate inventory", "five-year disclosure schedule" ] } ``` Source downloaded (UTC): 2026-09-09T23:53:24.824Z to 2026-09-09T23:53:24.824Z Record version: sha256:3edc653191e57daa2f616e2f23f929782f8d3b6ba471c9c741e5115630c93137 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-976-05: 05 Overview and Background [Read section](https://asc.understandingaccounting.org/asc/330/976/#05-overview-and-background) SEC content: no ##### [330-976-05-1](https://asc.understandingaccounting.org/asc/330/976/#330-976-05-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:24.824Z to 2026-09-09T23:53:24.824Z Record version: sha256:eef900a43a59f8facf8f8ae58337dc50077fc86b7f35d815efe6a7df42480b75 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic provides disclosure guidance concerning expenditures for improvements of entities with retail land sales operations. Source downloaded (UTC): 2026-09-09T23:53:26.451Z to 2026-09-09T23:53:26.451Z Record version: sha256:04833fec9a71f49f53ac697d3f878de0826c3e73be6e091b57da644be07fcff5 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-976-15: 15 Scope and Scope Exceptions [Read section](https://asc.understandingaccounting.org/asc/330/976/#15-scope-and-scope-exceptions) SEC content: no #### Overall Guidance ##### [330-976-15-1](https://asc.understandingaccounting.org/asc/330/976/#330-976-15-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:26.451Z to 2026-09-09T23:53:26.451Z Record version: sha256:4907c617bbbfb85d0ebb00e60e8ddca82822afd0dd8ca6c8c62edcf1d43d003a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see Section 976-10-15. Source downloaded (UTC): 2026-09-09T23:53:30.083Z to 2026-09-09T23:53:30.083Z Record version: sha256:ac2c8d6c9cb07b95c4ac892ead02eb721b75f73bb74bc399ad81245851983179 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-976-50: 50 Disclosure [Read section](https://asc.understandingaccounting.org/asc/330/976/#50-disclosure) SEC content: no ##### [330-976-50-1](https://asc.understandingaccounting.org/asc/330/976/#330-976-50-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:30.083Z to 2026-09-09T23:53:30.083Z Record version: sha256:9942bebf4570df633f9b66d6d3d9f2c26b3c9876a5dacfaca13c70a21baf08b4 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Disclosures by entities with retail land sales operations shall include both of the following: 1. a Estimated total costs and estimated dates of expenditures for improvements for major areas from which sales are being made over each of the five years following the date of the financial statements 2. b Recorded obligations for improvements. Source downloaded (UTC): 2026-09-09T23:53:35.942Z to 2026-09-09T23:53:56.981Z Record version: sha256:079b1a54bdb9c9efc46e9b9839886b42f720908a27ad6fdf9cfaa1f33994f318 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-978: Inventory — Real Estate—Time-Sharing Activities ### Machine-generated study aids ```json { "summary": "ASC 330-978 governs how time-share sellers measure time-sharing inventory (intervals) and cost of sales. Sellers must use the relative sales value method, applied phase by phase, with common costs (including amenities) allocated among benefited phases, and must recalculate total estimated time-sharing revenue and total costs at least quarterly. Changes in estimate are recorded as current-period adjustments, and rental/other activity during the holding period is treated as incidental operations that reduce the pool of inventory costs.", "key_points": [ "Sellers of time-sharing intervals account for cost of sales and inventory using the relative sales value method, applied separately to each phase, with common costs such as amenities allocated among the phases they benefit (330-978-30-1).", "At least quarterly—even if no quarterly SEC reports are filed—total time-sharing revenue (actual to-date plus expected future) and total cost estimates must be recalculated, incorporating uncollectibles, price/mix changes, repossessions, upgrade programs, and sales incentives; the cost-of-sales percentage is recomputed each time (330-978-35-1).", "Effects of changes in estimate are accounted for as a current-period adjustment so that the ending balance sheet and subsequent accounting are as if the revised estimates had been the original ones, with disclosure under 250-10-50-4 (330-978-35-1).", "An adjustment for expected uncollectibles carries a corresponding adjustment to cost of sales and inventory via the cost-of-sales percentage; repossession or reacquisition of an interval has no inventory effect unless it changes expected uncollectibles (330-978-35-2).", "Inventory must still be tested for impairment under 360-10-35-38 through 35-40, 360-10-35-43, and 360-10-40-5 (330-978-35-2).", "Rental and other operations during holding periods are incidental operations: incremental revenue exceeding incremental cost reduces the pool of inventory costs (and is not projected into the relative sales value calculation), while incremental cost exceeding revenue is expensed as incurred (330-978-35-3).", "During holding periods—beginning when intervals are held for and available for sale (e.g., legally registered as time-shares)—intervals are inventory and are not depreciated; rental activity outside the holding period requires depreciation and lessor accounting under Subtopic 842-30 (330-978-35-4 through 35-6)." ], "categories": [ "Subsequent measurement", "Inventory and PP&E", "Industry-specific", "Impairment" ], "audience_level": "advanced", "student_note": "This is a niche, industry-specific measurement model: the relative sales value method links inventory relief directly to revenue estimates, so a change in expected uncollectibles automatically changes cost of sales and inventory. A common misunderstanding is thinking a repossessed interval goes back into inventory—it does not, unless the repossession changes the estimate of uncollectibles.", "related_topics": [ "978-330", "978-810", "606-10", "360-10", "250-10", "842-30" ], "key_concepts": [ "relative sales value method", "time-sharing interval", "cost-of-sales percentage", "incidental operations", "holding period", "change in estimate", "expected uncollectibles", "inventory impairment" ] } ``` Source downloaded (UTC): 2026-09-09T23:53:35.942Z to 2026-09-09T23:53:35.942Z Record version: sha256:e76ae7891bb86ffcaef83599a3c6d1dee932ba3f28b58bd753035ce38d3ab58f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-978-00: 00 Status [Read section](https://asc.understandingaccounting.org/asc/330/978/#00-status) SEC content: no ##### [330-978-00-1](https://asc.understandingaccounting.org/asc/330/978/#330-978-00-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:35.942Z to 2026-09-09T23:53:35.942Z Record version: sha256:2f28356cc790deb938b7dafedc6903398a1481e07758e878ff31a6b3259ff3ff Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The following table identifies the changes made to this Subtopic.
ParagraphActionAccounting Standards UpdateDate
ContractAddedAccounting Standards Update No. 2014-0905/28/2014
CustomerAddedAccounting Standards Update No. 2014-0905/28/2014
Deposit MethodSupersededAccounting Standards Update No. 2014-0905/28/2014
Incremental Costs from Incidental OperationsAddedAccounting Standards Update No. 2014-0905/28/2014
Incremental Revenue from Incidental OperationsAddedAccounting Standards Update No. 2014-0905/28/2014
Mini-VacationAddedAccounting Standards Update No. 2014-0905/28/2014
Phase (2nd def.)AmendedAccounting Standards Update No. 2014-0603/14/2014
RevenueAddedAccounting Standards Update No. 2014-0905/28/2014
Time-SharingAmendedAccounting Standards Update No. 2014-0603/14/2014
Sampler ProgramAddedAccounting Standards Update No. 2014-0905/28/2014
Undivided Interest (2nd def.)SupersededAccounting Standards Update No. 2014-0603/14/2014
978-330-15-3AmendedAccounting Standards Update No. 2014-0905/28/2014
978-330-15-4AmendedAccounting Standards Update No. 2014-0905/28/2014
978-330-30-1AmendedAccounting Standards Update No. 2014-0905/28/2014
978-330-30-2SupersededAccounting Standards Update No. 2014-0905/28/2014
978-330-30-3AmendedAccounting Standards Update No. 2014-0905/28/2014
978-330-35-1 through 35-4
AmendedAccounting Standards Update No. 2014-0905/28/2014
978-330-35-6AmendedAccounting Standards Update No. 2016-0202/25/2016
Source downloaded (UTC): 2026-09-09T23:53:39.402Z to 2026-09-09T23:53:39.402Z Record version: sha256:425ef4ddeed47bbd416154a493e396b8637ae8c0293357a3550c65e07a246bb5 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-978-05: 05 Overview and Background [Read section](https://asc.understandingaccounting.org/asc/330/978/#05-overview-and-background) SEC content: no ##### [330-978-05-1](https://asc.understandingaccounting.org/asc/330/978/#330-978-05-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:39.402Z to 2026-09-09T23:53:39.402Z Record version: sha256:64334e2a978488e66cf7f5b4f374880d1901efd2c3737c9b7cb39b3df429f0d0 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic addresses real estate [time-sharing](https://asc.understandingaccounting.org/glossary/t/#time-sharing "An arrangement in which a seller sells or conveys the right to occupy a dwelling unit for specified periods in the future. Forms of time-sharing arrangements include but are not limited to fixed and floating time, interval ownership, undivided interests, points programs, vacation clubs, right-to-use arrangements such as tenancy-for-years arrangements, and arrangements involving special-purpose entities. In this context, an undivided interest is a time-sharing arrangement that involves a tenant-in-common interest in a condominium unit or entire improved property, and in which the interest holder is assigned a specific period (generally, a specific week). The interest holder is also assigned a specific unit if the undivided interest is in the entire improved property.") inventory measurement issues. Time-sharing inventory consists of [time-sharing interests](https://asc.understandingaccounting.org/glossary/t/#time-sharing-interest "See Interval.") or [intervals](https://asc.understandingaccounting.org/glossary/i/#interval "The specific period (generally, a specific week) during the year that a time-sharing unit is specified by agreement to be available for occupancy by a particular customer. Also denoted Time-Sharing Interest or Time-Share."). Source downloaded (UTC): 2026-09-09T23:53:41.579Z to 2026-09-09T23:53:41.579Z Record version: sha256:c7d2086c12ee7dae11de7a72f331991e0bd4c2486c55e1748c169fc165700663 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-978-15: 15 Scope and Scope Exceptions [Read section](https://asc.understandingaccounting.org/asc/330/978/#15-scope-and-scope-exceptions) SEC content: no #### Overall Guidance ##### [330-978-15-1](https://asc.understandingaccounting.org/asc/330/978/#330-978-15-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:41.579Z to 2026-09-09T23:53:41.579Z Record version: sha256:28f8b6f918de02fc224394ca2eb43e1490844268012e94462717e5a35f70e08d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see Section 978-10-15, with specific transaction exceptions noted below. ##### [330-978-15-2](https://asc.understandingaccounting.org/asc/330/978/#330-978-15-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:41.579Z to 2026-09-09T23:53:41.579Z Record version: sha256:5e42eaf65d157ea097ed20b5862d3bcdd7c4072b6a67375cdc4c8e11769afc53 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See paragraph [978-810-25-3](https://asc.understandingaccounting.org/asc/810/978/#810-978-25-3) for guidance concerning when an entity shall recognize its interests in a [special-purpose entity](https://asc.understandingaccounting.org/glossary/s/#time-sharing-special-purpose-entity "An entity, typically a corporation or a trust, to which a seller transfers time-sharing real estate in exchange for the entity's stock, membership interests, or beneficial interests.") as inventory. #### Transactions ##### [330-978-15-3](https://asc.understandingaccounting.org/asc/330/978/#330-978-15-3) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:41.579Z to 2026-09-09T23:53:41.579Z Record version: sha256:50c4e5ff439e5e1ed166316db592a2f09d7749c1a8fc95780df4442ffee296a3 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The guidance in this Subtopic applies to the following transactions and activities: 1. a All [time-sharing](https://asc.understandingaccounting.org/glossary/t/#time-sharing "An arrangement in which a seller sells or conveys the right to occupy a dwelling unit for specified periods in the future. Forms of time-sharing arrangements include but are not limited to fixed and floating time, interval ownership, undivided interests, points programs, vacation clubs, right-to-use arrangements such as tenancy-for-years arrangements, and arrangements involving special-purpose entities. In this context, an undivided interest is a time-sharing arrangement that involves a tenant-in-common interest in a condominium unit or entire improved property, and in which the interest holder is assigned a specific period (generally, a specific week). The interest holder is also assigned a specific unit if the undivided interest is in the entire improved property.") sale transactions that are within the scope of Topic 606 on [revenue](https://asc.understandingaccounting.org/glossary/r/#revenue "Inflows or other enhancements of assets of an entity or settlements of its liabilities (or a combination of both) from delivering or producing goods, rendering services, or other activities that constitute the entity's ongoing major or central operations.") from [contracts](https://asc.understandingaccounting.org/glossary/c/#contract "An agreement between two or more parties that creates enforceable rights and obligations.") with [customers](https://asc.understandingaccounting.org/glossary/c/#customer "A party that has contracted with an entity to obtain goods or services that are an output of the entity's ordinary activities in exchange for consideration."). ##### [330-978-15-4](https://asc.understandingaccounting.org/asc/330/978/#330-978-15-4) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:41.579Z to 2026-09-09T23:53:41.579Z Record version: sha256:212a59dd1b0fb498e6a712f6c94e985465b15153ffd0401c8ce67c85c5dd9e4e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The guidance in this Subtopic does not apply to the following transactions and activities: 1. a Time-sharing transactions transactions that fail to meet all of the criteria in paragraph [606-10-25-1](https://asc.understandingaccounting.org/asc/606/10/#606-10-25-1) and, therefore, are accounted for in accordance with paragraphs [606-10-25-6 through 25-8](https://asc.understandingaccounting.org/asc/606/10/#606-10-25-6) . Source downloaded (UTC): 2026-09-09T23:53:47.501Z to 2026-09-09T23:53:47.501Z Record version: sha256:f6aa8bdcb470fafcd43fef5deb278fedbc7c189ae05d184df502103ff27549c6 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-978-30: 30 Initial Measurement [Read section](https://asc.understandingaccounting.org/asc/330/978/#30-initial-measurement) SEC content: no #### Accounting for Cost of Sales and Time-Sharing Inventory ##### [330-978-30-1](https://asc.understandingaccounting.org/asc/330/978/#330-978-30-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:47.501Z to 2026-09-09T23:53:47.501Z Record version: sha256:2ffa67a7d3c4df84713266d4be5c80b18c48b07d5783b56e2754eb516656605d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Sellers of [time-sharing](https://asc.understandingaccounting.org/glossary/t/#time-sharing "An arrangement in which a seller sells or conveys the right to occupy a dwelling unit for specified periods in the future. Forms of time-sharing arrangements include but are not limited to fixed and floating time, interval ownership, undivided interests, points programs, vacation clubs, right-to-use arrangements such as tenancy-for-years arrangements, and arrangements involving special-purpose entities. In this context, an undivided interest is a time-sharing arrangement that involves a tenant-in-common interest in a condominium unit or entire improved property, and in which the interest holder is assigned a specific period (generally, a specific week). The interest holder is also assigned a specific unit if the undivided interest is in the entire improved property.") intervals shall account for cost of sales and time-sharing inventory using the [relative sales value method](https://asc.understandingaccounting.org/glossary/r/#relative-sales-value-method "The relative sales value method is similar to a gross profit method and is used to allocate inventory cost and determine cost of sales in conjunction with a sale. Under the relative sales value method, cost of sales is calculated as a percentage of net sales using a cost-of-sales percentage—the ratio of total estimated cost (including costs to complete, if any) to total estimated time-sharing revenue. Time-sharing revenue is calculated as total expected future revenue adjusted for total expected future bad-debt expense."). The relative sales value method shall be applied to each [phase](https://asc.understandingaccounting.org/glossary/p/#phase "A contractually or physically distinguishable portion of a real estate project (including time-sharing projects). That portion is distinguishable from other portions based on shared characteristics such as: Units a developer has declared or legally registered to be for sale Units linked to an owners association Units to be constructed during a particular time period How a developer plans to build the real estate project.") separately. [Common costs](https://asc.understandingaccounting.org/glossary/c/#common-costs "Costs that relate to two or more units or phases within a real estate or time-sharing project."), including [amenities](https://asc.understandingaccounting.org/glossary/a/#amenities "Features that enhance the attractiveness or perceived value of a time-sharing interval. Examples of amenities include golf courses, utility plants, clubhouses, swimming pools, tennis courts, indoor recreational facilities, and parking facilities. See also Promised Amenities."), shall be allocated to inventory among the phases that those costs will benefit. ##### [330-978-30-2](https://asc.understandingaccounting.org/asc/330/978/#330-978-30-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:47.501Z to 2026-09-09T23:53:47.501Z Record version: sha256:d1883a9a7c87420e4721eab2d97960e35be628ab470bc464fabd00aac5234837 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Paragraph superseded by Accounting Standards Update No. 2014-09](https://asc.understandingaccounting.org/updates/asu-2014-09/). ##### [330-978-30-3](https://asc.understandingaccounting.org/asc/330/978/#330-978-30-3) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:47.501Z to 2026-09-09T23:53:47.501Z Record version: sha256:fb3bfc4fac30fe02867a3a7fff83b2a87e0eca5c1327bafc978bb28460d5dcec Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See paragraph [978-330-35-1](https://asc.understandingaccounting.org/asc/330/978/#330-978-35-1) for additional guidance related to the determination of total time-sharing revenue and total cost estimates. Source downloaded (UTC): 2026-09-09T23:53:49.878Z to 2026-09-09T23:53:49.878Z Record version: sha256:e999298da762f0115e529ec461e6c30f4bea00d7813302f505a505959656dac5 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-978-35: 35 Subsequent Measurement [Read section](https://asc.understandingaccounting.org/asc/330/978/#35-subsequent-measurement) SEC content: no #### Accounting for Cost of Sales and Time-Sharing Inventory ##### [330-978-35-1](https://asc.understandingaccounting.org/asc/330/978/#330-978-35-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:49.878Z to 2026-09-09T23:53:49.878Z Record version: sha256:93c00dd3a546348564b2b0155c0fbaac8f5401e3a7a913351354f568aac3e1e6 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. At least quarterly, both total [time-sharing](https://asc.understandingaccounting.org/glossary/t/#time-sharing "An arrangement in which a seller sells or conveys the right to occupy a dwelling unit for specified periods in the future. Forms of time-sharing arrangements include but are not limited to fixed and floating time, interval ownership, undivided interests, points programs, vacation clubs, right-to-use arrangements such as tenancy-for-years arrangements, and arrangements involving special-purpose entities. In this context, an undivided interest is a time-sharing arrangement that involves a tenant-in-common interest in a condominium unit or entire improved property, and in which the interest holder is assigned a specific period (generally, a specific week). The interest holder is also assigned a specific unit if the undivided interest is in the entire improved property.") revenue (actual to-date plus expected future revenue) and total cost estimates shall be recalculated. A time-sharing entity shall adjust at least quarterly even if it does not issue quarterly financial reports under Securities and Exchange Commission (SEC) reporting requirements. The estimate of total time-sharing revenue (actual to-date plus expected future revenue) for use in the [relative sales value method](https://asc.understandingaccounting.org/glossary/r/#relative-sales-value-method "The relative sales value method is similar to a gross profit method and is used to allocate inventory cost and determine cost of sales in conjunction with a sale. Under the relative sales value method, cost of sales is calculated as a percentage of net sales using a cost-of-sales percentage—the ratio of total estimated cost (including costs to complete, if any) to total estimated time-sharing revenue. Time-sharing revenue is calculated as total expected future revenue adjusted for total expected future bad-debt expense.") shall incorporate factors such as incurred or estimated uncollectibles, changes in sales prices or sales mix, repossession of intervals that the seller may or may not be able to resell, effects of [upgrade](https://asc.understandingaccounting.org/glossary/u/#upgrade "A time-sharing transaction whereby a customer relinquishes the right to a currently held time-sharing interval and obtains a higher-priced time-sharing interval from the same seller.") programs, and past or expected sales incentives to sell slow-moving inventory units. Such amounts should be included in the estimate of total time-sharing revenue for use in the relative sales value method even when those amounts are recognized as bad-debt expense within the statement of comprehensive income rather than included within the revenue recognized. The cost-of-sales percentage shall be similarly recalculated each time estimated revenue (including amounts reported or expected to be reported as revenue or as bad-debt expense) or cost is adjusted, using the new estimate of total time-sharing revenue and total cost (including costs to complete, if any). The effects of changes in estimate for cost shall be accounted for in each period using a current-period adjustment, that is, the [time-share](https://asc.understandingaccounting.org/glossary/t/#time-share "See Interval.") seller shall account for a change in estimate in the period of change so that the balance sheet at the end of the period of change and the accounting in subsequent periods are as they would have been if the revised estimates had been the original estimates. The effects of changes in estimate shall be disclosed in accordance with paragraph [250-10-50-4](https://asc.understandingaccounting.org/asc/250/10/#250-10-50-4). The inventory balance reported in the balance sheet, plus estimated costs to complete that inventory, if any, represents a pool of costs that will be charged against future revenue. ##### [330-978-35-2](https://asc.understandingaccounting.org/asc/330/978/#330-978-35-2) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:49.878Z to 2026-09-09T23:53:49.878Z Record version: sha256:5e72b0a175b95992a3c7a41b5b09f509ec6d53b98ef6200e6ce44b92aad28bbe Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The recording of an adjustment for expected uncollectibles is accompanied by a corresponding adjustment to cost of sales and inventory that is effected through the application of the cost-of-sales percentage. However, under the relative sales value method, there is no accounting effect on inventory if a time-sharing [interval](https://asc.understandingaccounting.org/glossary/i/#interval "The specific period (generally, a specific week) during the year that a time-sharing unit is specified by agreement to be available for occupancy by a particular customer. Also denoted Time-Sharing Interest or Time-Share.") is repossessed or otherwise reacquired unless the repossession causes a change in expected uncollectibles. The seller shall, however, perform impairment testing on its inventory in accordance with paragraphs [360-10-35-38 through 35-40](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-38) , [360-10-35-43](https://asc.understandingaccounting.org/asc/360/10/#360-10-35-43), and [360-10-40-5](https://asc.understandingaccounting.org/asc/360/10/#360-10-40-5). ##### [330-978-35-3](https://asc.understandingaccounting.org/asc/330/978/#330-978-35-3) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:49.878Z to 2026-09-09T23:53:49.878Z Record version: sha256:46b67542b04959f09fce6a1c21f57631830d0c958688fbdf2a93fd79fd9f2941 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Revenue from and costs of rental and other operations during holding periods shall be accounted for as [incidental operations](https://asc.understandingaccounting.org/glossary/i/#incidental-operations "Revenue-producing activities engaged in during the holding or development period to reduce the cost of developing the property for its intended use, as distinguished from activities designed to generate a profit or a return from the use of the property."). [Incremental revenue from incidental operations](https://asc.understandingaccounting.org/glossary/i/#incremental-revenues-from-incidental-operations "Revenues that would not be produced except in relation to the conduct of incidental operations.") in excess of [incremental costs from incidental operations](https://asc.understandingaccounting.org/glossary/i/#incremental-costs-of-incidental-operations "Costs that would not be incurred except in relation to the conduct of incidental operations. Interest, taxes, insurance, security, and similar costs that would be incurred during the development of a real estate project regardless of whether incidental operations were conducted are not incremental costs.") shall be accounted for as a reduction of inventory costs—that is, the pool of inventory costs under the relative sales value method as described in paragraph [978-330-35-1](https://asc.understandingaccounting.org/asc/330/978/#330-978-35-1). Estimates of future amounts of such excess should not be factored into the calculations of the relative sales value method. Incremental costs in excess of incremental revenue should be charged to expense as incurred. #### Operations during Holding Periods ##### [330-978-35-4](https://asc.understandingaccounting.org/asc/330/978/#330-978-35-4) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:49.878Z to 2026-09-09T23:53:49.878Z Record version: sha256:70d2ae59762715d784f5916b92a9fed1ea9826a5b90890a89c9a49f60ee6e756 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Holding period](https://asc.understandingaccounting.org/glossary/h/#holding-period "The period during which a time-sharing interval is held for sale. Sellers may offer time-sharing units for rent during such holding periods.") operations include [sampler programs](https://asc.understandingaccounting.org/glossary/s/#sampler-program "A marketing program under which a time-share developer offers a customer, who has previously toured one of the developer's projects, a stay at one of the projects at a reduced rate. In exchange, the customer agrees to take another, subsequent tour of the project selected under the sampler program during the customer's stay at that project. If the subsequent tour results in a sale, the developer may allow the customer to apply some or all of the amount paid for the sampler toward the purchase of a time-share, as a part of the down payment. Also referred to as Exit Program.") and [mini-vacations](https://asc.understandingaccounting.org/glossary/m/#mini-vacation "A marketing program under which a time-share developer offers, for a fee, a short (typically, two to three days) visit to a destination where the developer operates a project. The developer typically subsidizes the fee to the customer for the mini-vacation in exchange for the customer attending a sales presentation at the project. The mini-vacation may include room accommodations, entertainment tickets, and similar items of value. The customer typically accepts the offer of the fee subsidy in exchange for his or her attending the sales presentation."). During holding periods, time-sharing intervals shall be accounted for as inventory and shall not be depreciated. Costs of operations during holding periods include seller subsidies and maintenance and related costs on time-sharing intervals held for sale. ##### [330-978-35-5](https://asc.understandingaccounting.org/asc/330/978/#330-978-35-5) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:49.878Z to 2026-09-09T23:53:49.878Z Record version: sha256:0ae0826a861ca4d89fce19b7075c42da56a0f1eb9e8894eb3dec0a4de528fab8 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. For time-sharing operations, the holding period (as that term is used in the definition of [incidental operations](https://asc.understandingaccounting.org/glossary/i/#incidental-operations "Revenue-producing activities engaged in during the holding or development period to reduce the cost of developing the property for its intended use, as distinguished from activities designed to generate a profit or a return from the use of the property.")) begins at the time that intervals are held for and are available for sale—for example, when units in domestic locations are legally registered for sale as time-shares. A seller shall evaluate each period as to whether units previously considered held for and available for sale shall continue to be characterized as such. ##### [330-978-35-6](https://asc.understandingaccounting.org/asc/330/978/#330-978-35-6) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:49.878Z to 2026-09-09T23:53:49.878Z Record version: sha256:15d29a8dff1e3b6ca4314c8d48e7dd47eb26e1f08de1c27765c44bee48277fe5 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If rental activities occur other than during the holding period, the corresponding units shall be depreciated and those activities shall be accounted for as rental operations in accordance with Subtopic 842-30 on leases—lessors. Source downloaded (UTC): 2026-09-09T23:53:53.503Z to 2026-09-09T23:53:53.503Z Record version: sha256:a98747a13fc2947f8564a3b57793183bc40ae782615c9b8fa4b886b9278e4a6f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-978-50: 50 Disclosure [Read section](https://asc.understandingaccounting.org/asc/330/978/#50-disclosure) SEC content: no ##### [330-978-50-1](https://asc.understandingaccounting.org/asc/330/978/#330-978-50-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:53.503Z to 2026-09-09T23:53:53.503Z Record version: sha256:be6b9f4a08043b89350e26f0732d1e576354acfebd7063faaffd34d5c23f8e89 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. See paragraph [978-330-35-1](https://asc.understandingaccounting.org/asc/330/978/#330-978-35-1) for disclosure requirements for changes in estimates used to perform the [relative sales value method](https://asc.understandingaccounting.org/glossary/r/#relative-sales-value-method "The relative sales value method is similar to a gross profit method and is used to allocate inventory cost and determine cost of sales in conjunction with a sale. Under the relative sales value method, cost of sales is calculated as a percentage of net sales using a cost-of-sales percentage—the ratio of total estimated cost (including costs to complete, if any) to total estimated time-sharing revenue. Time-sharing revenue is calculated as total expected future revenue adjusted for total expected future bad-debt expense."). Source downloaded (UTC): 2026-09-09T23:53:59.630Z to 2026-09-09T23:54:12.400Z Record version: sha256:9015556e7af97e46aaba92407753c4627622ebb8b787302a0cf80db55d609afe Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-985: Inventory — Software ### Machine-generated study aids ```json { "summary": "This subtopic governs how a software vendor accounts for the costs of producing physical copies of software to be sold, leased, or otherwise marketed. Costs of duplicating the software, documentation, and training materials from the product masters and of physically packaging the product for distribution are capitalized as inventory on a unit-specific basis (330-985-25-1). Those capitalized costs are charged to cost of sales when revenue from the sale of the related units is recognized (330-985-40-1).", "key_points": [ "Scope follows the Software Overall Subtopic, Section 985-10-15 (330-985-15-1), i.e., software to be sold, leased, or otherwise marketed.", "Duplication costs for the software, documentation, and training materials from product masters, plus physical packaging costs for distribution, are capitalized as inventory on a unit-specific basis (330-985-25-1).", "Capitalized duplication and packaging costs are charged to cost of sales when revenue from the sale of those units is recognized (330-985-40-1), matching cost with revenue.", "The guidance addresses only inventory costs of computer software (330-985-05-1); costs of developing the product masters themselves are addressed elsewhere in Topic 985." ], "categories": [ "Inventory and PP&E", "Recognition", "Derecognition", "Industry-specific" ], "audience_level": "intermediate", "student_note": "Exam trap: distinguish costs of creating the product master (software development costs under 985-20, amortized as an asset) from costs of duplicating and packaging copies (inventory here, expensed to cost of sales as units sell). Students often expense duplication costs as incurred instead of capitalizing them as inventory.", "related_topics": [ "985-10", "985-20", "985-605", "330-10", "350-40" ], "key_concepts": [ "product masters", "duplication costs", "packaging costs", "unit-specific capitalization", "software inventory", "cost of sales", "software to be sold, leased, or marketed" ] } ``` Source downloaded (UTC): 2026-09-09T23:53:59.630Z to 2026-09-09T23:53:59.630Z Record version: sha256:eb1dc616c7071b66e7501e82eba65add7007deeb1f71e94d3b79a06eb1226c13 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-985-05: 05 Overview and Background [Read section](https://asc.understandingaccounting.org/asc/330/985/#05-overview-and-background) SEC content: no ##### [330-985-05-1](https://asc.understandingaccounting.org/asc/330/985/#330-985-05-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:53:59.630Z to 2026-09-09T23:53:59.630Z Record version: sha256:6d5dee2f04171cc1821fa71b1a7cba7f5de06606528516aabb667f08940e50e8 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic provides guidance on inventory costs of computer software. Source downloaded (UTC): 2026-09-09T23:54:02.015Z to 2026-09-09T23:54:02.015Z Record version: sha256:60b0ab29f22e3ec994e69681b442f2a429a720813a88b4fcc56be320decc499e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-985-15: 15 Scope and Scope Exceptions [Read section](https://asc.understandingaccounting.org/asc/330/985/#15-scope-and-scope-exceptions) SEC content: no #### Overall Guidance ##### [330-985-15-1](https://asc.understandingaccounting.org/asc/330/985/#330-985-15-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:54:02.015Z to 2026-09-09T23:54:02.015Z Record version: sha256:bf22ec9f1e4d6602c21a9f59de270d4ad83f3f3dc424997e91e39834bc5bba7f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see Section 985-10-15. Source downloaded (UTC): 2026-09-09T23:54:08.959Z to 2026-09-09T23:54:08.959Z Record version: sha256:1381f369bbe054a639aa4dcda369e99fd3f3f5c32e5f743c6714c4ca452be833 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-985-25: 25 Recognition [Read section](https://asc.understandingaccounting.org/asc/330/985/#25-recognition) SEC content: no ##### [330-985-25-1](https://asc.understandingaccounting.org/asc/330/985/#330-985-25-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:54:08.959Z to 2026-09-09T23:54:08.959Z Record version: sha256:c8639d7bc9ee45d7ba3a1b46f6376b0840ff2d798b16999cc4ebaf1d80332d5a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The costs incurred for duplicating the computer software, documentation, and training materials from the [product masters](https://asc.understandingaccounting.org/glossary/p/#product-master "A completed version, ready for copying, of the computer software product, the documentation, and the training materials that are to be sold, leased, or otherwise marketed.") and for physically packaging the product for distribution shall be capitalized as inventory on a unit-specific basis. Source downloaded (UTC): 2026-09-09T23:54:12.400Z to 2026-09-09T23:54:12.400Z Record version: sha256:2f0ee26171efab9e80a5d369d9720c65c488178f396cbcf83500c5101f5b7bfe Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 330-985-40: 40 Derecognition [Read section](https://asc.understandingaccounting.org/asc/330/985/#40-derecognition) SEC content: no ##### [330-985-40-1](https://asc.understandingaccounting.org/asc/330/985/#330-985-40-1) Pending content: no Source downloaded (UTC): 2026-09-09T23:54:12.400Z to 2026-09-09T23:54:12.400Z Record version: sha256:21b2ed7fcd6f45af62a84e29fd8505df1d0ccc8b9509c404010a42ab60c47e90 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The costs incurred for duplicating the computer software, documentation, and training materials from the [product masters](https://asc.understandingaccounting.org/glossary/p/#product-master "A completed version, ready for copying, of the computer software product, the documentation, and the training materials that are to be sold, leased, or otherwise marketed.") and for physically packaging the product for distribution shall be charged to cost of sales when revenue from the sale of those units is recognized.