ALOHA Company determined the following information for an inventory at year end. Historical Cost P 2,000,000 Current Replacement Cost P 1,400,000 Net Realizable Value P 1,800,000 Net Realizable Value less a normal profit margin P 1,700,000 Fair Value P 1,900,000 What amount should be reported as inventory at year end? a. P 1,400,000 b. P 1,700,000 c. P 1,800,000 d. P 1,900,000

Cornerstones of Financial Accounting
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Chapter6: Cost Of Goods Sold And Inventory
Section: Chapter Questions
Problem 26CE: Lower of Cost or Market The accountant for Murphy Company prepared the following analysis of its...
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ALOHA Company determined the following information for an inventory at year end.


Historical Cost P 2,000,000
Current Replacement Cost P 1,400,000
Net Realizable Value P 1,800,000
Net Realizable Value less a normal profit margin P 1,700,000
Fair Value P 1,900,000


What amount should be reported as inventory at year end?
a. P 1,400,000
b. P 1,700,000
c. P 1,800,000
d. P 1,900,000

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