Applying the lower of cost or market to each item of inventory, what should the total inventory value be for the following items? Market Inventory Cost per Value per Total Total Item Quantity Unit Unit Cost Market A 300 $15.00 $14.50 $4,500 $4,350 В 200 $14.00 $15.00 $2,800 $3,000 100 $17.00 $17.50 $1,700 $1,750 Oa. $8,850 Оb. $9,000 Oc. $9,100 Od. $9,250

Applying the lower of cost or market to each item of inventory, what should the total inventory value be for the following items? Market Inventory Cost per Value per Total Total Item Quantity Unit Unit Cost Market A 300 $15.00 $14.50 $4,500 $4,350 В 200 $14.00 $15.00 $2,800 $3,000 100 $17.00 $17.50 $1,700 $1,750 Oa. $8,850 Оb. $9,000 Oc. $9,100 Od. $9,250

Corporate Financial Accounting

15th Edition

ISBN:9781337398169

Author:Carl Warren, Jeff Jones

Publisher:Carl Warren, Jeff Jones

Chapter6: Inventories

Section: Chapter Questions

Problem 7DQ: Using the following data, how should the inventory be valued under lower of cost or market? Original...

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Inventory Valuation Specific identification method Weighted average cost method FIFO method LIFO method LIFO liquidation LIFO conformity rule LIFO reserve Replacement cost Inventory profit Lower-of-cost-or-market (LCM) rule Inventory turnover ratio Number of days sales in inventory Moving average (Appendix) The name given to an average cost method when a weighted average cost assumption is used with a perpetual inventory system. An inventory costing method that assigns the same unit cost to all units available for sale during the period. A conservative inventory valuation approach that is an attempt to anticipate declines in the value of inventory before its actual sale. An inventory costing method that assigns the most recent costs to ending inventory. The current cost of a unit of inventory. An inventory costing method that assigns the most recent costs to cost of goods sold. A measure of how long it takes to sell inventory. The IRS requirement that when LIFO is used on a tax return, it must also be used in reporting income to stockholders. An inventory costing method that relies on matching unit costs with the actual units sold. The portion of the gross profit that results from holding inventory during a period of rising prices. The result of selling more units than are purchased during the period, which can have negative tax consequences if a company is using LIFO. The excess of the value of a companys inventory stated at FIFO over the value stated at LIFO. A measure of the number of times inventory is sold during the period.
Using the following data, how should the inventory be valued under lower of cost or market? Original cost 1,350 Estimated selling price 1,475 Selling expenses 180
Retail Inventory Method The following information relates to the retail inventory method used by Jeffress Company: Required: 1. Compute the ending inventory by the retail inventory method using the following cost flow' assumptions (round the cost-to-retail ratio to 3 decimal places): a. FIFO b. average cost c. LIFO d. lower of cost or market (based on average cost) 2. Next Level What assumptions are necessary for the retail inventory method to produce accurate estimates of ending inventory?
Using the following data, how should the inventory be valued under lower of cost or market? Original cost 1,350 Estimated selling price 1,475 Selling expenses 180
Retail Inventory Method EKC Company uses the retail inventory method. The following information for 2019 is available: Required: Compute the cost of the ending inventory under each of the following cost flow assumptions (round the cost-to-retail ratio to 3 decimal places): 1. FIFO 2. average cost 3. LIFO 4. lower of cost or market (based on average cost)
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