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The inventory of Royal Decking consisted of five products. Information about the December 31, 2021, inventory is as follows: Per Unit Product Cost Replacement Cost A $ 40 8 C D E 38922 Product 80 40 А 100 20 Selling costs consist of a sales commission equal to 10% of selling price and shipping costs equal to 5% of cost. The normal profit is 30% of selling price. Required: What unit value should Royal Decking use for each of its products when applying the lower of cost or market (LCM) rule to units of ending inventory? Cost ABCDE 98988 $ 80 $35 70 55 70 28 40 $ 40 100 20 Replacement cost Selling Price $ 60 100 80 130 30 35 70 55 70 28 NRV NRV - NP Market Per Unit Inventory Value

The inventory of Royal Decking consisted of five products. Information about the December 31, 2021, inventory is as follows: Per Unit Product Cost Replacement Cost A $ 40 8 C D E 38922 Product 80 40 А 100 20 Selling costs consist of a sales commission equal to 10% of selling price and shipping costs equal to 5% of cost. The normal profit is 30% of selling price. Required: What unit value should Royal Decking use for each of its products when applying the lower of cost or market (LCM) rule to units of ending inventory? Cost ABCDE 98988 $ 80 $35 70 55 70 28 40 $ 40 100 20 Replacement cost Selling Price $ 60 100 80 130 30 35 70 55 70 28 NRV NRV - NP Market Per Unit Inventory Value

Intermediate Accounting: Reporting And Analysis
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter8: Inventories: Special Valuation Issues
Section: Chapter Questions
Problem 2MC: Moore Company uses the LIFO cost flow assumption and carries Product A in inventory on December 31,...
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The inventory of Royal Decking consisted of five products. Information about the December 31, 2021, inventory is as follows: Per Unit Product Cost Replacement Cost $ 40 A B 80 C 40 D 100 20 Product Selling costs consist of a sales commission equal to 10% of selling price and shipping costs equal to 5% of cost. The normal profit is 30% of selling price. A B Required: What unit value should Royal Decking use for each of its products when applying the lower of cost or market (LCM) rule to units of ending inventory? C D DE Cost $35 70 55 70 28 40 100 $ 40 $ 80 20 Replacement cost Selling Price $ 60 100 80 35 70 55 70 28 130 30 NRV NRV NP Market Per Unit Inventory Value
Transcribed Image Text:The inventory of Royal Decking consisted of five products. Information about the December 31, 2021, inventory is as follows: Per Unit Product Cost Replacement Cost $ 40 A B 80 C 40 D 100 20 Product Selling costs consist of a sales commission equal to 10% of selling price and shipping costs equal to 5% of cost. The normal profit is 30% of selling price. A B Required: What unit value should Royal Decking use for each of its products when applying the lower of cost or market (LCM) rule to units of ending inventory? C D DE Cost $35 70 55 70 28 40 100 $ 40 $ 80 20 Replacement cost Selling Price $ 60 100 80 35 70 55 70 28 130 30 NRV NRV NP Market Per Unit Inventory Value
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