A physical inventory of Liverpool Company taken at December 31 reveals the following. Per Unit Item Units Cost Market Car audio equipment Speakers 345 $ 100 $ 108 Stereos 260 121 110 Amplifiers 326 96 105 Subwoofers 204 62 51 Security equipment Alarms 480 160 135 Locks 291 103 94 Cameras 212 320 332 Binocular equipment Tripods 185 80 94 Stabilizers 170 107 115 Required: 1. Compute the lower of cost or market for the inventory applied separately to each item. 2. If the market amount is less than the recorded cost of the inventory, then record the LCM adjustment to the Merchandise Inventory account.
A physical inventory of Liverpool Company taken at December 31 reveals the following. Per Unit Item Units Cost Market Car audio equipment Speakers 345 $ 100 $ 108 Stereos 260 121 110 Amplifiers 326 96 105 Subwoofers 204 62 51 Security equipment Alarms 480 160 135 Locks 291 103 94 Cameras 212 320 332 Binocular equipment Tripods 185 80 94 Stabilizers 170 107 115 Required: 1. Compute the lower of cost or market for the inventory applied separately to each item. 2. If the market amount is less than the recorded cost of the inventory, then record the LCM adjustment to the Merchandise Inventory account.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:A physical inventory of Liverpool Company taken at December 31 reveals the following.
Per Unit
Item
Units
Cost
Market
Car audio equipment
Speakers
345
$ 100
$ 108
Stereos
260
121
110
Amplifiers
326
96
105
Subwoofers
204
62
51
Security equipment
Alarms
480
160
135
Locks
291
103
94
Cameras
212
320
332
Binocular equipment
Tripods
185
80
94
Stabilizers
170
107
115
Required:
1. Compute the lower of cost or market for the inventory applied separately to each item.
2. If the market amount is less than the recorded cost of the inventory, then record the LCM adjustment to the
Merchandise Inventory account.
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