Put offers on the same specification and required-quantity basis. Show unknown quality as unknown, compare explicit scenarios, and separate eventual replacement units from units available by the required date.
Make the offers comparable
Confirm the same specification, unit and required quantity. Record quote validity, minimum order, freight, packing, delivery date, payment terms and return or replacement terms. Keep excess minimum-order stock separate from units needed for the present job.
A fictional comparison before tax
Suppose both suppliers offer 1,000 units to the same specification. The usable quantities below are explicit scenario inputs based on buyer evidence, not industry rejection rates.
| Item | Supplier A | Supplier B |
|---|---|---|
| Quoted goods cost | ₹50,000 | ₹52,000 |
| Freight | ₹3,000 | Included |
| Total before tax | ₹53,000 | ₹52,000 |
| Usable units in this scenario | 980 | 1,000 |
| Cost per usable unit | ₹54.08 | ₹52.00 |
A is ₹53,000 ÷ 980 = about ₹54.08. B is ₹52,000 ÷ 1,000 = ₹52.00. Under these assumptions, B is ₹2.08 lower per usable unit.
When quality history is unknown
Mark usable quantity as unknown. Do not silently enter 100% or invent a defect rate. Compare named scenarios, for example all 1,000 units usable and 980 units usable, then state that the choice remains conditional on inspection evidence.
| Term | Supplier A | Supplier B |
|---|---|---|
| Quote valid until | 25 Sep | 23 Sep |
| Minimum order in this quote | 1,000 units | 1,000 units |
| Confirmed delivery | 30 Sep | 27 Sep |
| Quality evidence | 980-unit scenario; receipt evidence required | Unknown until inspection |
Dates and terms are fictional. The ₹54.08, ₹52.00 and ₹2.08 figures apply only to these original 1,000-unit quote terms. Compare while both quotes remain valid or request refreshed terms.
Keep a higher minimum-order case separate
Suppose a refreshed A quote instead requires 1,200 units. Under the separate fictional assumption that A retains its ₹50 per-unit goods rate and ₹3,000 freight, the buyer would commit 1,200 × ₹50 + ₹3,000 = ₹63,000. That is not the original ₹53,000 offer and cannot inherit its ₹54.08 usable-unit result.
| Measure | Amount |
|---|---|
| Current requirement | 1,000 units |
| Minimum purchase | 1,200 units |
| Goods cash at assumed ₹50 per unit | ₹60,000 |
| Freight under this separate case | ₹3,000 |
| Total cash committed before tax | ₹63,000 |
| Units above current requirement | 200 units |
Show the ₹63,000 cash commitment and 200 excess units separately. Do not treat excess stock as free or force its full cost into the current 1,000-unit job without a stated allocation rule. Confirm the refreshed unit rate, freight, quality and future use before comparing this case with B.
Model replacement timing separately
If A replaces 20 rejected units free, record replacement freight, dispatch date and arrival date. Eventual usable units may become 1,000, but only 980 may be available by the customer’s required date. A free replacement can still create a timing or transport consequence.
| Measure | Initial receipt | After replacement |
|---|---|---|
| Usable units available | 980 by 30 Sep | 1,000 by 5 Oct |
| Additional freight | — | ₹600 unless supplier confirms otherwise |
| Required-date result | 20 units short on 30 Sep | Complete after required date |
Give a conditional, checkable recommendation
For the original quotes, say: “Under A’s 1,000-unit quote and 980-usable-unit scenario, B is ₹2.08 lower per usable unit. B’s quality is still unknown, and its quote expires earlier.” If A’s actual minimum is 1,200, withdraw that comparison and use the separate ₹63,000 minimum-order case after confirming its assumptions. Keep the reason when the choice changes.
IAS 2’s overview is a broader stock-cost reference. This commercial worksheet does not determine the accounting or tax treatment for your business.
Questions you might ask
What usable quantity should I enter without quality history?
Mark it unknown and compare named scenarios. Do not invent a defect rate or silently assume every unit will be usable.
How should free replacement of rejected units affect a quote comparison?
Include replacement freight and timing. Separate eventual usable units from units available by the required date.
How do minimum orders and quote expiry affect comparison?
Use the same required quantity, show excess minimum-order stock separately, and compare while terms are valid or obtain refreshed quotes.