Inventory: Reversal of write down of Inventory IFRS
Why the reversal of inventory has to reduce COGS.
“In each subsequent period, a new assessment of net realisable value is made. Reversal (limited to the amount of the original write-down) is required for a subsequent increase in value of inventory previously written down. The reversal of any write-down of inventories is recognised as a reduction in cost of sales (reduction in the amount of inventories recognised as an expense).” CFA Curriculum book pg 426.
With reversal the Current asset should increase by that amount why COGS is reduced?. What am I missing?
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