A company determined the following values for its inventory as of the end of its fiscal year: Historical cost: $50,000 Current replacement cost: $35,000 Net realizable value: $45,000 Net realizable value less a normal profit margin: $40,000 Fair value: $48,000 What amount should be the company report for inventory on its balance sheet? a. $35,000 b. $40,000 c. $45,000 d. $48,000
A company determined the following values for its inventory as of the end of its fiscal year: Historical cost: $50,000 Current replacement cost: $35,000 Net realizable value: $45,000 Net realizable value less a normal profit margin: $40,000 Fair value: $48,000 What amount should be the company report for inventory on its balance sheet? a. $35,000 b. $40,000 c. $45,000 d. $48,000
Chapter10: Inventory
Section: Chapter Questions
Problem 2TP: Assume your company uses the periodic inventory costing method, and the inventory count left out an...
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Transcribed Image Text:A company determined the following values for its inventory as
of the end of its fiscal year:
Historical cost: $50,000
Current replacement cost: $35,000
Net realizable value: $45,000
Net realizable value less a normal profit margin: $40,000
Fair value: $48,000
What amount should be the company report for inventory on
its balance sheet?
a. $35,000
b. $40,000
c. $45,000
d. $48,000
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