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Inventories

6 Months Ended

Dec. 31, 2014

Inventory Disclosure [Abstract]

8. Inventories

ASC 330-10-35, “Adjustments to Lower of Cost or Market”, requires us to reduce the carrying value of inventory when there is evidence that the utility of goods will be less than cost, whether due to physical deterioration, obsolescence, changes in price levels or other causes.

As of December 31, 2014 and June 30, 2014, inventories consisted of the following:

		December 31, 2014				June 30, 2014
At cost:
Raw materials		$	654,008			$	1,058,697
Work in progress			667,284				842,276
Finished goods			4,643,248				5,000,511
Consumable items			3,304,748				3,442,586
		$	9,269,288			$	10,344,070

Costs of finished goods include direct labor, direct materials, and production overhead before the goods are ready for sale.

Consumable items represent parts used in our cold rolling mills and other equipment that need to be replaced from time to time when necessary to ensure optimal operating results, such as auxiliary materials and rollers.

Inventories amounting to $6,921,105 (June 30, 2014: $6,703,684) were pledged for short-term loans totaling $19,635,406 at December 31, 2014 (June 30, 2014: $19,647,434).

The entire disclosure for inventory. This may include, but is not limited to, the basis of stating inventory, the method of determining inventory cost, the major classes of inventory, and the nature of the cost elements included in inventory. If inventory is stated above cost, accrued net losses on firm purchase commitments for inventory and losses resulting from valuing inventory at the lower-of-cost-or-market may also be included. For LIFO inventory, may disclose the amount and basis for determining the excess of replacement or current cost over stated LIFO value and the effects of a LIFO quantities liquidation that impacts net income.

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