At 12/31/21, the end of Bell Company's first year of business, inventory was $158,800 and $157,900 at cost and at net realizable value, respectively. Bell uses FIFO for valuing inventories, and they apply the lower of cost or net realizable value on an individual item basis to compute the inventory valuation on 12/31/21. Bell uses the allowance method to reduce inventories, as needed. The following table displays information for Bell's inventory at 12/31/22. Product A-1 A-2 B-1 B-2 B-3 C-1 Cost 12.00 13.50 38.40 42.50 44.20 68.00 Replacment Cost 11.00 13.00 36.00 42.00 45.00 68.00 What journal entry is required at 12/31/22? Selling Price 15.00 18.00 48.00 50.00 52.00 80.00 Costs to complete 4.00 3.00 8.00 8.00 8.00 9.00 Normal Profit on Sales 20% 25% 20% 15% 15% 15% Quantity 1,200 1,000 900 800 750 500
At 12/31/21, the end of Bell Company's first year of business, inventory was $158,800 and $157,900 at cost and at net realizable value, respectively. Bell uses FIFO for valuing inventories, and they apply the lower of cost or net realizable value on an individual item basis to compute the inventory valuation on 12/31/21. Bell uses the allowance method to reduce inventories, as needed. The following table displays information for Bell's inventory at 12/31/22. Product A-1 A-2 B-1 B-2 B-3 C-1 Cost 12.00 13.50 38.40 42.50 44.20 68.00 Replacment Cost 11.00 13.00 36.00 42.00 45.00 68.00 What journal entry is required at 12/31/22? Selling Price 15.00 18.00 48.00 50.00 52.00 80.00 Costs to complete 4.00 3.00 8.00 8.00 8.00 9.00 Normal Profit on Sales 20% 25% 20% 15% 15% 15% Quantity 1,200 1,000 900 800 750 500
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter6: Cost Of Goods Sold And Inventory
Section: Chapter Questions
Problem 37BE: Lower of Cost or Market Garcia Company uses FIFO, and its inventory at the end of the year was...
Related questions
Question
Answer all questions clearly
![At 12/31/21, the end of Bell Company's first year of business, inventory was $158,800 and $157,900
at cost and at net realizable value, respectively. Bell uses FIFO for valuing inventories, and they apply
the lower of cost or net realizable value on an individual item basis to compute the inventory valuation
on 12/31/21. Bell uses the allowance method to reduce inventories, as needed.
The following table displays information for Bell's inventory at 12/31/22.
Product
A-1
A-2
B-1
B-2
B-3
C-1
Cost
12.00
13.50
38.40
42.50
44.20
68.00
Replacment
Cost
11.00
13.00
36.00
42.00
45.00
68.00
What journal entry is required at 12/31/22?
(Be sure to show all computations and relevant T accounts.)
Selling
Price
15.00
18.00
48.00
50.00
52.00
80.00
Costs to
complete
4.00
3.00
8.00
8.00
8.00
9.00
Normal Profit
on Sales
20%
25%
20%
15%
15%
15%
Quantity
1,200
1,000
900
800
750
500](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F8cdfb300-3a1b-48d6-95db-8c34f2bdcfcc%2F62d1fe52-3df1-40eb-8420-406f998b2bb2%2Fodyskx5_processed.png&w=3840&q=75)
Transcribed Image Text:At 12/31/21, the end of Bell Company's first year of business, inventory was $158,800 and $157,900
at cost and at net realizable value, respectively. Bell uses FIFO for valuing inventories, and they apply
the lower of cost or net realizable value on an individual item basis to compute the inventory valuation
on 12/31/21. Bell uses the allowance method to reduce inventories, as needed.
The following table displays information for Bell's inventory at 12/31/22.
Product
A-1
A-2
B-1
B-2
B-3
C-1
Cost
12.00
13.50
38.40
42.50
44.20
68.00
Replacment
Cost
11.00
13.00
36.00
42.00
45.00
68.00
What journal entry is required at 12/31/22?
(Be sure to show all computations and relevant T accounts.)
Selling
Price
15.00
18.00
48.00
50.00
52.00
80.00
Costs to
complete
4.00
3.00
8.00
8.00
8.00
9.00
Normal Profit
on Sales
20%
25%
20%
15%
15%
15%
Quantity
1,200
1,000
900
800
750
500
Expert Solution
![](/static/compass_v2/shared-icons/check-mark.png)
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 6 steps
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
![Cornerstones of Financial Accounting](https://www.bartleby.com/isbn_cover_images/9781337690881/9781337690881_smallCoverImage.gif)
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning
Principles of Accounting Volume 1
Accounting
ISBN:
9781947172685
Author:
OpenStax
Publisher:
OpenStax College
![Intermediate Accounting: Reporting And Analysis](https://www.bartleby.com/isbn_cover_images/9781337788281/9781337788281_smallCoverImage.jpg)
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
![Cornerstones of Financial Accounting](https://www.bartleby.com/isbn_cover_images/9781337690881/9781337690881_smallCoverImage.gif)
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning
Principles of Accounting Volume 1
Accounting
ISBN:
9781947172685
Author:
OpenStax
Publisher:
OpenStax College
![Intermediate Accounting: Reporting And Analysis](https://www.bartleby.com/isbn_cover_images/9781337788281/9781337788281_smallCoverImage.jpg)
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
![Financial Accounting](https://www.bartleby.com/isbn_cover_images/9781337272124/9781337272124_smallCoverImage.gif)
Financial Accounting
Accounting
ISBN:
9781337272124
Author:
Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:
Cengage Learning
![Survey of Accounting (Accounting I)](https://www.bartleby.com/isbn_cover_images/9781305961883/9781305961883_smallCoverImage.gif)
Survey of Accounting (Accounting I)
Accounting
ISBN:
9781305961883
Author:
Carl Warren
Publisher:
Cengage Learning
![Financial And Managerial Accounting](https://www.bartleby.com/isbn_cover_images/9781337902663/9781337902663_smallCoverImage.jpg)
Financial And Managerial Accounting
Accounting
ISBN:
9781337902663
Author:
WARREN, Carl S.
Publisher:
Cengage Learning,