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Blossom Home Improvement Company installs replacement siding, windows, and louvered glass doors for single-family homes and condominium complexes. The company is in the process of preparing its annual financial statements for the fiscal year ended May 31, 2025. Jim Alcide, controller for Blossom, has gathered the following data concerning inventory. At May 31, 2025, the balance in Blossom's Raw Materials Inventory account was $444,720. Alcide summarized the relevant inventory cost and market data at May 31, 2025, in the schedule below. Alcide assigned Patricia Devereaux, an intern from a local college, the task of calculating the amount that should appear on Blossom's May 31, 2025, financial statements for inventory under the lower-of-cost-or- market rule as applied to each item in inventory. Devereaux expressed concern over departing from the historical cost principle. Consider the following expanded data at May 31, 2025. Assume Blossom uses LIFO inventory costing. Aluminum siding Cedar shake siding Louvered glass doors Thermal windows Total Inventory loss Cost $ $76,300 93,740 122,080 152,600 $444,720 Replacement Cost $68,125 86,546 135,160 137,340 $427,171 Sales Price $69,760 102,460 203,176 168,732 $544,128 Net Realizable Value $61,040 92,432 183,447 152,600 (a1) Determine the write-down, if any, to reduce inventory to market at May 31, 2025. $489,519 Normal Profit $5,559 8,066 20,165 16,786 $50,576

Blossom Home Improvement Company installs replacement siding, windows, and louvered glass doors for single-family homes and condominium complexes. The company is in the process of preparing its annual financial statements for the fiscal year ended May 31, 2025. Jim Alcide, controller for Blossom, has gathered the following data concerning inventory. At May 31, 2025, the balance in Blossom's Raw Materials Inventory account was $444,720. Alcide summarized the relevant inventory cost and market data at May 31, 2025, in the schedule below. Alcide assigned Patricia Devereaux, an intern from a local college, the task of calculating the amount that should appear on Blossom's May 31, 2025, financial statements for inventory under the lower-of-cost-or- market rule as applied to each item in inventory. Devereaux expressed concern over departing from the historical cost principle. Consider the following expanded data at May 31, 2025. Assume Blossom uses LIFO inventory costing. Aluminum siding Cedar shake siding Louvered glass doors Thermal windows Total Inventory loss Cost $ $76,300 93,740 122,080 152,600 $444,720 Replacement Cost $68,125 86,546 135,160 137,340 $427,171 Sales Price $69,760 102,460 203,176 168,732 $544,128 Net Realizable Value $61,040 92,432 183,447 152,600 (a1) Determine the write-down, if any, to reduce inventory to market at May 31, 2025. $489,519 Normal Profit $5,559 8,066 20,165 16,786 $50,576

Financial Accounting
Financial Accounting
15th Edition
ISBN:9781337272124
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Carl Warren, James M. Reeve, Jonathan Duchac
Chapter7: Inventories
Section: Chapter Questions
Problem 4CP: Golden Eagle Company began operations on April 1 by selling a single product. Data on purchases and...
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Blossom Home Improvement Company installs replacement siding, windows, and louvered glass doors for single-family homes and condominium complexes. The company is in the process of preparing its annual financial statements for the fiscal year ended May 31, 2025. Jim Alcide, controller for Blossom, has gathered the following data concerning inventory. At May 31, 2025, the balance in Blossom's Raw Materials Inventory account was $444,720. Alcide summarized the relevant inventory cost and market data at May 31, 2025, in the schedule below. Alcide assigned Patricia Devereaux, an intern from a local college, the task of calculating the amount that should appear on Blossom's May 31, 2025, financial statements for inventory under the lower-of-cost-or- market rule as applied to each item in inventory. Devereaux expressed concern over departing from the historical cost principle. Consider the following expanded data at May 31, 2025. Assume Blossom uses LIFO inventory costing. Aluminum siding Cedar shake siding Louvered glass doors Thermal windows Total Inventory loss LA Cost $ $76,300 93,740 122,080 152,600 $444,720 Replacement Cost $68,125 86,546 135,160 137,340 $427,171 Sales Price $69,760 102,460 203,176 168,732 $544,128 Net Realizable Value $61,040 92,432 183,447 (a1) Determine the write-down, if any, to reduce inventory to market at May 31, 2025. 152,600 $489,519 Normal Profit $5,559 8,066 20,165 16,786 $50,576
Transcribed Image Text:Blossom Home Improvement Company installs replacement siding, windows, and louvered glass doors for single-family homes and condominium complexes. The company is in the process of preparing its annual financial statements for the fiscal year ended May 31, 2025. Jim Alcide, controller for Blossom, has gathered the following data concerning inventory. At May 31, 2025, the balance in Blossom's Raw Materials Inventory account was $444,720. Alcide summarized the relevant inventory cost and market data at May 31, 2025, in the schedule below. Alcide assigned Patricia Devereaux, an intern from a local college, the task of calculating the amount that should appear on Blossom's May 31, 2025, financial statements for inventory under the lower-of-cost-or- market rule as applied to each item in inventory. Devereaux expressed concern over departing from the historical cost principle. Consider the following expanded data at May 31, 2025. Assume Blossom uses LIFO inventory costing. Aluminum siding Cedar shake siding Louvered glass doors Thermal windows Total Inventory loss LA Cost $ $76,300 93,740 122,080 152,600 $444,720 Replacement Cost $68,125 86,546 135,160 137,340 $427,171 Sales Price $69,760 102,460 203,176 168,732 $544,128 Net Realizable Value $61,040 92,432 183,447 (a1) Determine the write-down, if any, to reduce inventory to market at May 31, 2025. 152,600 $489,519 Normal Profit $5,559 8,066 20,165 16,786 $50,576
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