The Canadian Institute of Chartered Accountants has made the capitalization of capital assets optional for organizations with revenues less than $500,000 (see capital assets). There is no similar opportunity for organizations to avoid the capitalization of inventory. Material inventories must be recorded on the balance sheet.
If the inventories are held 'for profit" they would be valued at the lower of cost and their net realizable value. (3031.10) Cost would include all costs incurred in the production or acquistion of the inventory. (3031.11) If the inventory was contributed, cost would be the fair value on the date of contribution. (3032.03).