(a) Calculate the LCNRV using the “individual-item” approach. (b) Prepare the journal entries as at 31 December 2020 assuming that a loss method and the Allowance to Reduce Inventory to NRV Account is used to record the write down of the inventory. (c) Assume that as at 31 December 2020, the account of Allowance to Reduce Inventory to NRV had a credit balance of RM14,500. Determine the amount of the gain or loss that would be recorded due to the change in the Allowance to Reduce Inventory to NRV Account as in (b). Show the related journal entries.
(a) Calculate the LCNRV using the “individual-item” approach. (b) Prepare the journal entries as at 31 December 2020 assuming that a loss method and the Allowance to Reduce Inventory to NRV Account is used to record the write down of the inventory. (c) Assume that as at 31 December 2020, the account of Allowance to Reduce Inventory to NRV had a credit balance of RM14,500. Determine the amount of the gain or loss that would be recorded due to the change in the Allowance to Reduce Inventory to NRV Account as in (b). Show the related journal entries.
College Accounting, Chapters 1-27
23rd Edition
ISBN:9781337794756
Author:HEINTZ, James A.
Publisher:HEINTZ, James A.
Chapter27: Adjustments, Financial Statements, And Year-end Accounting For A Manufacturing
business
Section: Chapter Questions
Problem 1MP: Reese Manufacturing Company manufactures and sells a limited line of products made to customer...
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(a) Calculate the LCNRV using the “individual-item” approach.
(b) Prepare the
(c) Assume that as at 31 December 2020, the account of Allowance to Reduce Inventory to NRV had a credit balance of RM14,500. Determine the amount of the gain or loss that would be recorded due to the change in the Allowance to Reduce Inventory to NRV Account as in (b). Show the related journal entries.
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