Following information is related to Product X of Zempa Company: Current replacement cost $230 Cost to distribute $42 Historical cost Normal profit margin Selling price $215 $36 $245 If lower-of-cost-or-market rule (LCM Rule) is applied, then the value of Product X that would be reported in the balance sheet is: a. $215 b. $230 c. $203 d. S167

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A:

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A:

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A: Break-Even Sales: It the amount of Revenue at which the Total Cost of Production (Variable Costs +…

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A: Working                          Total cost per unit under Absorption Costing for production…

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A: Income from the offer acceptance = Units * ( Sale Price - Variable Manufacturing Cost)

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A: Differential Analysis Differential analysis (also called incremental analysis) is a management…

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A: Inventory is valued at Lower of cost or market value NRV= Net selling price - Cost to complete the…

Q: Jacoby Company received an offer from an exporter for 25,100 units of product at $18 per unit. The…

A: Since the offer will not affect normal production or domestic sales, hence the differential revenue…

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A: Cost incurred in both the alternatives will be calculated  and compared.

Q: Product Tango has revenue of $195,500, variable cost of goods sold of $114,300, variable selling…

A: Differential analysis is used to evaluate the current position of the business. which business can…

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A: Differential analysis: This is a technique of management accounting where in changes in revenues,…

Q: Galla Incorporated is a competitive product market. The expected selling price is $340 per unit, and…

A: Expected Selling price = $340 Target profit = 20%

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A: Absorption costing is a method of costing under which total cost incurred for manufacturing of…

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A: 1. Explain the cost-volume relationships that should Paulsen take into consideration for the…

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A: Formula: Contribution margin = sales - variable cost Deduction of sales price from variable cost…

Q: The following income statements illustrate different cost structures for two competing companies:…

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A: Mark-up % on total cost = Desired Profit / Total Costs x 100

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A: Solution:- Preparation of segment margin income statement as follows under:-

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A: Variable cost means the cost which vary with the level of output where as fixed cost remain fixed…

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A: Percentage of  profit margin on sales =  Profit margin / Sales

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A: Operating Income Operating income is described as after deducting the cost of goods sold other…

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A: Last-in, first-out (LIFO) is the inventory valuation method in which the inventory which is…

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A:

Q: ease in operating income of $60,000 more than it would be without accepting the sp price to ur…

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Inventory Valuation

Before discussing the topic inventory valuation let’s discuss the meaning of inventory. In accounting, inventory is also known as stock. Inventory means all the finished goods, materials, merchandise that a business holds for the purpose of selling it in the market with the motive of earning profit.