CPE Self-Study

Tax Accounting for Inventories - Tax Staff Essentials

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    Tax Accounting for Inventories - Tax Staff Essentials Availability : Online Access Product #: 157654
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There are multiple ways to derive an inventory valuation, but which method will affect the amount of taxable income recognized? This CPE course details the methods of valuing inventory, including special rules for dealing with FIFO and LIFO. Effect of shrinkage and market will also be discussed and participants will learn about proposals to prohibit LCM and subnormal goods methods that include wash-sale goods.

This course also offers practical guidance on which costs are included or excluded from the UNICAP calculation and identifies which companies are subject to the UNICAP rules.

Learning Objectives

  • Identify the allowable inventory valuation methods for tax purposes.
  • Examine scenarios in which a taxpayer may wish to use FIFO or LIFO inventory methods.
  • Recognize when a taxpayer can qualify to use the simplified dollar-value LIFO method.
  • Determine which costs are included or excluded from the UNICAP calculation.
  • Identify which companies are subject to the UNICAP rules.
  • Recognize the simplified production method.
  • Identify when an estimated shrinkage deduction can be claimed.
  • Identify when a corporation is allowed to reduce the inventory value of goods.

Key Topics

  • Inventory methods
  • Financial statement conformity
  • Switching inventory methods
  • IRC Section 263A, Uniform Capitalization Rules (UNICAP)
  • Direct Costs, indirect costs, burden rates
  • Estimating inventory shrinkage

Who Will Benefit?

  • Tax professionals in public accounting: seniors, supervisors, and managers; tax professionals within corporate finance or tax departments


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Find out more information on the Tax Section.

Table of Contents

System Requirements

About the Authors

Barbara Aue, CPA

About the Publisher

American Institute of CPAs

The American Institute of CPAs (AICPA) is the world’s largest member association representing the CPA profession, with more than 418,000 members in 143 countries, and a history of serving the public interest since 1887. AICPA members represent many areas of practice, including business and industry, public practice, government, education and consulting.

The AICPA sets ethical standards for the profession and U.S. auditing standards for private companies, nonprofit organizations, federal, state and local governments. It develops and grades the Uniform CPA Examination, and offers specialized credentials for qualified professionals who concentrate on personal financial planning; forensic accounting; business valuation; and information management and technology assurance. With The Chartered Institute of Management Accountants (CIMA), it offers the Chartered Global Management Accountant (CGMA) designation, which sets the global benchmark for quality and recognition in management accounting.

The AICPA and CIMA also make up the Association of International Certified Professional Accountants (the Association), which represents public and management accounting globally, advocating on behalf the public interest and advancing the quality, competency and employability of CPAs, CGMAs and other accounting and finance professionals worldwide.

The AICPA maintains offices in New York, Washington, DC, Durham, NC, and Ewing, NJ.