Andrew Peller Limited Essay Example | Topics and Well Written Essays - 500 words

Andrew Peller Limited - Essay Example The costs of goods sold, excluding amortization includes the costs of finished goods inventory sold during the year, inventory write-downs and revaluations of agricultural produce at fair value less costs to sell at the point of harvest. In this regards, the costs of goods sold excluding amortization are classified as variable costs. The company carries property, plant and equipment at cost less accumulated amortization with the costs including the borrowing costs for the assets requiring a substantial period of time to become ready for use which are calculated on a straight-line basis in amounts sufficient to amortize the cost of building, vineyard infrastructure and machinery and equipment over their estimated useful lives. The fact that they vary with the useful life of the property, plant and equipment implies that they are classified as variable costs. The company classifies financial instruments into different categories with the company choosing not to apply hedge accounting for any of its derivative financial instruments. Consequently, the company nets transactional costs relating to long-term debt against the carrying value of the liability which is then amortized over the expected life of the instrument using the effective interest method. These costs are classified as fixed