The accounting for inventories is a major consideration for many entities because of its significance on both the statement of profit or loss (cost of goods sold) and the statement of financial position. There are two types of entities for which the accounting for inventories must be considered. The merchandising entity is usually entitled merchandise inventory. The other type of entity is the manufacturer, which generally has three types of inventory: Raw materials inventory, Work in process (WIP), and Finished goods inventory. The major objectives of accounting for inventories are the matching of appropriate costs against revenues in order to arrive at the proper determination of periodic income, and the accurate representation of inventories on hand as assets of the reporting entity at the end of the reporting period. In general, inventories are to be carried at cost, although, cost may be ascertained by a variety of methods under IAS 2.