A local Chevrolet dealership carries the following types of vehicles: Inventory Items Quantity Unit Cost Unit NRV Vans $20,500 $18,500 Trucks 7 16,700 15,700 2-door sedans 3 11,700 13,700 4-door sedans 5 15,700 18,700 Sports cars 1 30,500 33,500 SUVS 6 27,400 21,500 Because of recent increases in gasoline prices, the car dealership has noticed a reduced demand for its SUVs, vans, and trucks. Required: 1. Compute the total cost of the entire inventory. 2. Determine whether each inventory item would be reported at cost or net realizable value (NRV). Enter the amount of either the Unit Cost or Unit NRV in the "Lower of Cost and NRV per unit" column and then multiply this amount by the quantity of each inventory item and enter it in the Total column. 3. Record any necessary adjusting entry to write down inventory from cost to net realizable value.
A local Chevrolet dealership carries the following types of vehicles: Inventory Items Quantity Unit Cost Unit NRV Vans $20,500 $18,500 Trucks 7 16,700 15,700 2-door sedans 3 11,700 13,700 4-door sedans 5 15,700 18,700 Sports cars 1 30,500 33,500 SUVS 6 27,400 21,500 Because of recent increases in gasoline prices, the car dealership has noticed a reduced demand for its SUVs, vans, and trucks. Required: 1. Compute the total cost of the entire inventory. 2. Determine whether each inventory item would be reported at cost or net realizable value (NRV). Enter the amount of either the Unit Cost or Unit NRV in the "Lower of Cost and NRV per unit" column and then multiply this amount by the quantity of each inventory item and enter it in the Total column. 3. Record any necessary adjusting entry to write down inventory from cost to net realizable value.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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please double underline answer all parts with all work like explanation , computation for each parts and steps answer in text form please remember answer all parts with explanation , calculation clearly for all mostly Bartleby expert did not provide explanation please explain each part with explanation and computation
Transcribed Image Text:A local Chevrolet dealership carries the following types of vehicles:
Inventory Items
Quantity
Unit Cost
Unit NRV
Vans
$20,500
$18,500
Trucks
7
16,700
15,700
2-door sedans
3
11,700
13,700
4-door sedans
5
15,700
18,700
Sports cars
1
30,500
33,500
SUVS
6
27,400
21,500
Because of recent increases in gasoline prices, the car dealership has noticed a reduced demand for its SUVs, vans, and
trucks.
Required:
1. Compute the total cost of the entire inventory.
2. Determine whether each inventory item would be reported at cost or net realizable value (NRV). Enter the amount of
either the Unit Cost or Unit NRV in the "Lower of Cost and NRV per unit" column and then multiply this amount by the
quantity of each inventory item and enter it in the Total column.
3. Record any necessary adjusting entry to write down inventory from cost to net realizable value.
4. Determine the financial statement effects of using lower of cost and net realizable value to report inventory.
Complete this question by entering your answers in the tabs below.
Required 1 Required 2 Required 3
Required 4
Compute the total cost of the entire inventory.
Total cost
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