Blossom Company accumulates the following cost and net realizable value data at December 31. Inventory Categories Cost Data $10,015 Cameras Camcorders DVDs 8,010 11,445 Net Realizable Value $11,055 The lower-of-cost-or-net realizable value $ 8,340 10,055 Compute the lower-of-cost-or-net realizable value for company's inventory.

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Q: How can we calculate the Total Present Cost for the Base Case and Alternative?

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Inventory Valuation

Before discussing the topic inventory valuation let’s discuss the meaning of inventory. In accounting, inventory is also known as stock. Inventory means all the finished goods, materials, merchandise that a business holds for the purpose of selling it in the market with the motive of earning profit.