Honda Motor Co. Ltd. (HMC)

Honda Motor Co. Ltd. (HMC) | Analysis of Inventory

Inventory Accounting Policy

Inventories are stated at the lower of cost or market. Cost is determined principally on a first-in, first-out basis.

Source: Honda Motor Co. Ltd., Annual Report

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Honda Motor Co. Ltd., Statement of Financial Position, Inventory

USD $ in millions, translated from JPY ￥

Source: Based on data from Honda Motor Co. Ltd. Annual Reports

Item	Description	The company
Finished goods	Carrying amount as of the balance sheet date of merchandise or goods held by the company that are readily available for sale.	Honda Motor Co. Ltd.'s finished goods declined from 2009 to 2010 but then slightly increased from 2010 to 2011.
Work in process	Carrying amount as of the balance sheet date of merchandise or goods which are partially completed, are generally comprised of raw materials, labor and factory overhead costs, and which require further materials, labor and overhead to be converted into finished goods, and which generally require the use of estimates to determine percentage complete and pricing.	Honda Motor Co. Ltd.'s work in process declined from 2009 to 2010 but then increased from 2010 to 2011 exceeding 2009 level.
Raw materials	Carrying amount as of the balance sheet date of unprocessed items to be consumed in the manufacturing or production process. Also includes purchased parts that will be used as components of a finished product.	Honda Motor Co. Ltd.'s raw materials increased from 2009 to 2010 but then slightly declined from 2010 to 2011.
Inventories	Carrying amount (lower of cost or market) as of the balance sheet date of inventories less all valuation and other allowances. Excludes noncurrent inventory balances (expected to remain on hand past one year or one operating cycle, if longer).	Honda Motor Co. Ltd.'s inventories declined from 2009 to 2010 but then slightly increased from 2010 to 2011.