Accounting


FASB issued Statement no. 151 , Inventory Costs ( www.fasb.org/st/index.shtml ), an amendment of Accounting Research Bulletin (ARB) no. 43, chapter 4. The statement clarifies that abnormal amounts of idle facility expense, freight and/or handling costs and wasted materials (that is, spoilage) should be recognized as current-period charges, and it requires the allocation of fixed production overheads to inventory based on the normal capacity of the production facilities. The guidance is effective for inventory costs incurred during fiscal years beginning after June 15, 2005, but earlier application is permitted for costs incurred during fiscal years beginning after November 23, 2004. The statement’s provisions should be applied prospectively.

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These year-end tax planning strategies address recent tax law changes enacted to help taxpayers deal with the pandemic, such as tax credits for sick leave and family leave and new rules for retirement plan distributions, as well as techniques for putting your clients in the best possible tax position.

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