Introduction As a requirement to complete our coursework for the subject fundamentals of accounting (FOA).

We have done our research on the inventories, the process of valuation and recording of a company which is listed on the main board of Bursa Malaysia named MAMEE-DOUBLE DECKER (M) BERHAD. MAMEE-DOUBLE DECKER (M) BERHAD was founded and established at Malaysia in 1971 as a food and beverages (F&B) industry. They manufacture 5 types of F&B such as instant noodles, snacks, chilled, confectionery and beverages. We have done our research mainly on snacks. MAMEE-DOUBLE DECKER (M) BERHAD has few type of products under snacks category. They are double-decker, mister potato, mister potato crisps, rice crisps, mamee monster, corntoz, funkees mini and smax.

Types of inventories MAMEE-DOUBLE DECKER (M) BERHAD is using a various type of inventories in order to produce its end product (snack) and also for the packaging of the product. The raw materials that they use as ingredients for the process of making the snack are also a type of inventory. Since the snacks have a variety of flavors and types, the amount and type of ingredients they use is also various. The most comment raw materials they use are dehydrated potatoes since most of their products are made up of potato. Not only that, they also use sugar spices, monosodium glutamate (E621) as permitted flavor exchange and also permitted food additives of plant or synthetic origin for the long lasting of the food and to give a better taste. Moreover, they also use corn, vegetable oil (palm oil), salt, soy bean, milk and permitted food conditioner for further production. Since MAMEE-DOUBLE DECKER (M) BERHAD is producing few types of snacks so they also use wheat(gluten), fish, peanut, celery and mustard as an optional ingredients depending on the type and need of the snack. Besides that, according to our research and understanding the snacks are packed in various ways depending on the market strategy and potential buyers to purchase the product.

The most common packaging is either sealed cylinder or plastic bag. As what we understood this cylinders and plastic bags are purchased by MAMEE-DOUBLE DECKER (M) BERHAD and labeled to make them ready for the process of packaging. Whereby, all their snacks will be packed in this way. This is also a type of inventories which is used by this company. Process of manufacturing We have chosen two types of snacks and did some research on the process of manufacturing those snacks. The two snacks are Potato chips and Corntoz. Potato chips: First, select the potato to ensure no spoilt and skin-blistered potatoes. Next, to get rid of dirt and soil around it before the best potatoes are chosen manually, the selected potatoes are soaked in clean water. Put the potatoes into a rotating peeler .Slice the potatoes to prevent absorption of excess oil during the frying process. Then, clean the sliced potatoes with cold water. After that, cook the chips with vegetable oil at 180C. Carry the freshly cooked potatoes chips by a conveyer belt and channeled into a rotating drum. Mix the potatoes chips with variable flavours such as hot & spicy, original, barbeque and tomato. The chips are packed after it is cooled down to 45C.During the packing process; the potato chips are segregated according to flavours and popped into different coloured packs. Corntoz: First, harvest the ripe corn. Next, clean the corns .After that, rinse, cook and soak the corn before grinding it down to corn grits. Apply the intense heat to the grits-mixture until it expands and turns into corn sticks. Then, roast these corn sticks in an oven so they are light and crunchy. Toss around the baked corn sticks in the special blend of spices. After get the taste right, quickly packs it. Valuation of inventories Cost of the inventories can be calculated using two different methods. Either weighted average method (WAC) or first-in first-out basis (FIFO). After our research, we found that MAMEE-DOUBLE DECKER (M) BERHAD is using weighted average method (WAC) to determine the cost of the inventories for finished goods and work in

progress goods. Work in progress means raw materials, direct labour, other direct cost and related production overhead but excludes borrowing cost. However, they dont use the same method for consumable items and stored items and the cost of the inventories. They use First-in first-out basis for consumable and store item.

Amount of closing inventories According to MAMEE-DOUBLE DECKER (M) BERHADs consolidated of financial statement as at 31st December 2010, their inventories on 2008, 2009 and 2010 were RM30,640,434, RM26,490,987 and RM29,767,734 respectively. Besides, their unaudited condensed consolidated statement of financial position for the quarter ended 30 June 2011 states that at 30th June 2011 the inventories were valued as at RM36,008,000. This shows that the value of inventories on 2008 is the highest among the three years (2008, 2009 and 2010). However, as at 30th June 2011 the inventories value has been increased tremendously and breaks the 2008 record. This shows that the companys inventories has increased by RM5, 367,566 on the year 2011 compared to the year 2008. Thus, it concludes that companys profit has also increased. Definition of inventory The raw materials, work-in-process goods and completely finished goods that are considered to be the portion of a businesss assets those are ready or will be ready to be sold. Inventory represents one of the most important assets that most businesses possess, because the turnover of inventory represents one of the primary sources of revenue generation and subsequent earnings for the company's shareholders/owners. Definition of First-in First-out method This method is usually referred as FIFO which comes from the first letter of each word. This method describes the principle of queue processing technique demands by ordering process. In a simple meaning, this method describes that the principle of a firstcome, first-served behaviour or first item that is received should be the first item to be issued. The general rule is that inventory should be valued at the market value. Unless the inventory is obsolete, so that your inventory can be valued at cost.

Definition of Weighted Average Cost method This method is also known as WAC method and also known as AVCO. It is a method used to calculate the end inventory cost. It takes the cost of goods available for sale and divides it from the total amount of goods from opening inventories and purchases. This result a weighted average cost per unit. A physical count is then performed on the closing inventory to determine the amount of goods left. Finally, this amount is multiplied by Weighted Average Cost per Unit to give an estimate of closing inventory. Using this method, when each good is received, the average cost of each item is recalculated. Conclusion Based on the research that we have done, we got to know more about the MAMEE-DOUBLE DECKER (M) BERHAD company and its inventories. Besides, we also get to know the process of manufacturing of snacks and the raw materials they use in order to produce a snack. Not only that, we also learn to read and interpret the annual report of a company and manage to make a conclusion based on that. It really gave us a very good experience where we know how a company really functions and what type of inventories do a manufacturing company will have and use. We also feel very grateful to do this assignment because it not only gave us experience and knowledge but also taught us the meaning of hard work and teamwork. Each of us really applied the knowledge on what we have learnt in the previous chapter and also from our lecturer. We hope all my fellow members will also enjoy this assignment and learn as much as they can. We also would like to thank all the people including our lecturer and tutor who teach us and guide us on our assignment.

References. http://mamee.investor.net.my/balance-sheet http://mamee.investor.net.my/profit-loss http://www.investopedia.com/terms/i/inventory.asp#axzz1ZMV1uHVz http://www.investorwords.com/2589/inventory.html http://en.wikipedia.org/wiki/Mamee_Double-Decker http://investing.businessweek.com/research/stocks/snapshot/snapshot.asp?ticker=MAME E:MK http://www.mamee.com.au/products.html http://en.wikipedia.org/wiki/Mamee_Double-Decker http://superpages.com.my/listings/my51351 http://www.trademal.com/global/index.php/id/7948/Mamee_Double_Decker_M_Sdn_Bh d_/index.html http://www.businessdictionary.com/definition/inventory.html http://www.investorwords.com/2589/inventory.html http://www.accountingformanagement.com/fifo_method_of_materials_costing.htm http://www.answers.com/topic/weighted-average-inventory-method http://www.corntoz.com.my/ http://www.misterpotato.com.my/mu_contest/products.php?p=2

http://en.wikipedia.org/wiki/Lower_of_Cost_or_Market http://en.wikipedia.org/wiki/Net_realizable_value http://seandavies.articlesbase.com/accounting-articles/the-advantages-and-disadvantagesof-fifo-lifo-and-weighted-average-3416517.html http://www.entrepreneur.com/article/55578 http://en.wikipedia.org/wiki/FIFO wordnetweb.princeton.edu/perl/webwn