Applying the lower-of-cost-or-market method to each item of inventory, what should the total inventory value be for the following items?| Item | Inventory Quantity | Cost per Unit | Market Value per Unit | Total Cost Price | Total Market Price | Total LCM ||------|--------------------|---------------|-----------------------|------------------|--------------------|-----------|| A | 218 | $14 | $12 | $3,052 | $2,616 | $2,616 || B | 80 | $19 | $15 | $1,520 | $1,200 | $1,200 || C | 56 | $23 | $26 | $1,288 | $1,456 | $1,288 |**Explanation:**The table includes details of three inventory items labeled A, B, and C. Each item has specific data on inventory quantity, cost per unit, market value per unit, total cost price, and total market price. The column labeled "Total LCM" applies the lower-of-cost-or-market rule, which states that the inventory should be valued at the lower of either its cost or market value. Thus, for each item, the "Total LCM" value is the smaller amount between the "Total Cost Price" and "Total Market Price."

Name: Applying the lower-of-cost-or-market method to each item of inventory
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Description: Applying the lower-of-cost-or-market method to each item of inventory, what should the total inventory value be for the following items?| Item | Inventory Quantity | Cost per Unit | Market Value per Unit | Total Cost Price | Total Market Price | Tot

Lets understand the basics.Net realizable value is a value derive if item gets sold in the market. As per IAS 2 'Inventory", inventory should be valued at lower of cost or NRV.Lower of cost or NRV can be done using either on individual basis or on group basis.So here in this case, ItemQuantityCostMarket valueTotal costTotal marketTotal LCMA21814123,0522,6162,616B8019151,5201,2001,200C5623261,2881,4561,2885,104Therefore,ItemQuantityCostMarket valueTotal costTotal marketTotal LCMA21814123,0522,6162,616B8019151,5201,2001,200C5623261,2881,4561,2885,104

Business

Accounting

Applying the lower-of-cost-or-market Cost per Unit Item A B C Inventory Quantity 218 80 56 $14 19 method to each item of inventory, what should the total inventory value be for the following items? Market Value per Unit 23 $12 15 26 Total Cost Total Market Price $3,052 1,520 1,288 Price $2,616 1,200 1,456 Total LCM

Applying the lower-of-cost-or-market Cost per Unit Item A B C Inventory Quantity 218 80 56 $14 19 method to each item of inventory, what should the total inventory value be for the following items? Market Value per Unit 23 $12 15 26 Total Cost Total Market Price $3,052 1,520 1,288 Price $2,616 1,200 1,456 Total LCM

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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