1 2 3 4 5 Cost $8.00 $10.50 $12.00 $6.00 $7.20 Net realizable value 8.85 10.00 12.20 4.25 6.90 Net realizable value less normal profit 8.15 9.00 11.40 3.75 6.00 Market replacement cost 7.90 10.10 12.50 4.00 5.40 Determine the proper unit inventory price in the above independent cases by applying the lower of cost or market rule. Case 1 $ Case 2 $ Case 3 $ Case 4 $ Case 5 $

1 2 3 4 5 Cost $8.00 $10.50 $12.00 $6.00 $7.20 Net realizable value 8.85 10.00 12.20 4.25 6.90 Net realizable value less normal profit 8.15 9.00 11.40 3.75 6.00 Market replacement cost 7.90 10.10 12.50 4.00 5.40 Determine the proper unit inventory price in the above independent cases by applying the lower of cost or market rule. Case 1 $ Case 2 $ Case 3 $ Case 4 $ Case 5 $

Financial & Managerial Accounting

13th Edition

ISBN:9781285866307

Author:Carl Warren, James M. Reeve, Jonathan Duchac

Publisher:Carl Warren, James M. Reeve, Jonathan Duchac

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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Question:28 Given the historical cost of the product, Dominoe is $65, the selling price of product Dominoe is $90, costs to sell product Dominoe are $16, the replacement cost for product Dominoe is $60, and the normal profit margin is 20% of sales price, what is the amount that should be used to value the inventory under the lower-of-cost-or-market method? a. $65. b. $56. c. $60. d. $74.
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QUESTION 5 If the cost of an item of inventory is $60 and the current replacement cost is $75, the amount included in inventory according to the lower of cost or market is a. $135 b. $60 c. $75 d. $15
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Rate of Amount Rate of Markup Selling of Markup on Price Markup on Cost Selling Price $0.00 $330.00 25.00% 0.00 % $0.00 $0.00 0.00 % 26.00%
QUESTION 9 Which of the following statements is NOT true of Economic Order Quantity? O A. The economic order quantity mathematically determines the minimum total inventory cost O B. The EOQ is directly proportional to the sales per period OC. The optìmal order size is determined by the EOQ model O D. The EOQ ignores inventory reorder costs and inventory carrying costs
Cost Selling price Costs to sell Product 1 2 3 $ Required: What unit values should Han use for each of its products when applying the lower of cost or net realizable value (LCNRV) rule to ending inventory? Cost Product 1 $ 20 40 20✔ $ 90 ✓ 50 ✓ 6 NRV Product 2 $ 90 120 40 34✔✔ $ X 60✔ Product 3 $ 50 70 10 Per Unit Inventory Value 20✔ X 50 ✓
QUESTION 15 During a period when inventory costs are steadily increasing, which of the following is true? O a. Net income will be higher under LIFO than under FIFO. O b. Cost of goods sold will be lower under LIFO than under FIFO. O c. Ending inventory value will be higher under LIFO than under FIFO. O d. Income taxes will be lower under LIFO than under FIFO.
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Question 7 of 7 < < Suppose that Best Buy accumulates the following cost and net realizable value (NRV) data at December 31. Inventory Cost NRV Categories Data Data Earbuds $11,500 $10.300 Drones 7.900 8,700 Docking stations 13.900 12,800 What is the lower-of-cost-or-net-realizable-value of the inventory? Lower-of-cost-or-net-realizable-value eTextbook and Media LA As
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Determine the unit value that should be used for inventory costing following "lower of cost or market value" as described in ARB No. 43. A В E F Cost $2.75 $2.47 $2.75 $2.63 $2.48 $2.48 Replacement cost 2.00 2.95 2.00 2.61 2.37 2.50 Net realizable value 2.90 2.90 2.90 2.41 2.54 2.54 Net realizable value less normal profit 2.65 2.70 2.80 2.34 2.31 2.31 Case A 2$ Case B 2$ Case C 2$ Case D 2$ Case E Case F $ %24