A local Chevrolet dealership carries the following types of vehicles: Inventory ItemsQuantityUnit CostUnit NRVVans3$18,000$16,000Trucks616,20015,2002-door sedans211,20013,2004-door sedans715,20018,200Sports cars328,00031,000SUVs526,40019,000 Because of recent increases in gasoline prices, the car dealership has noticed a reduced demand for its SUVs, vans, and trucks.Required:4. Determine the financial statement effects of using lower of cost and net realizable value to report inventory. (Make sure to enter amounts leading to account reduction with a minus sign.)I need assistance solving Requirement 4 (specifically, the four boxes with a red 'X', which are currently not correct). Requirements 1 through 3 have already been answered correctly -- a screenshot is attached to show those values. For Requirement 4, the text presets available to choose from are as follow:No Journal Entry RequiredAccounts PayableAccounts ReceivableAdvertising ExpenseAllowance for Uncollectible AccountsBuildingsCashCommon StockCost of Goods SoldDeferred RevenueDelivery ExpenseEntertainment ExpenseEquipmentFreight-InGainIncome Tax ExpenseInsurance ExpenseInterest ExpenseInterest PayableInterest ReceivableInterest RevenueInventoryLandLegal Fees ExpenseNotes PayableNotes ReceivablePostage ExpensePrepaid AdvertisingPrepaid InsurancePrepaid RentPurchase DiscountsPurchase ReturnsPurchasesRent ExpenseRepairs and Maintenance ExpenseRetained EarningsSalaries ExpenseSalaries PayableSales AllowancesSales DiscountsSales ReturnsSales RevenueService Fee ExpenseService RevenueSuppliesSupplies ExpenseUtilities ExpenseUtilities Payable Required 1InventoryItemsComplete this question by entering your answers in the tabs below.Required 1 Required 2Total costComplete this question by entering your answers in the tabs below.TotalCompute the total cost of the entire inventory.VansTrucks2-door sedans4-door sedansSports carsSUVSRequired 2Cost orNRVDetermine whether each inventory item would be reported at cost or net realizable value (NRV). Enter the amount of eitherthe Unit Cost or Unit NRV in the "Lower of Cost and NRV per unit" column and then multiply this amount by the quantity ofeach inventory item and enter it in the Total column.NRVNRVCostCostCostNRV✓✓✓$ 496,000✓✓✓Required 3 Required 4Lower ofCost andNRV perunit16,000 $15,200 ✓11,200✔15,200✔28,000✔19,000✔Total48,000✔91,200✔22,400✔106,400✔84,00095.000447,000Required 3< Required 1Required 4Required 3 >< Required 1Required 1 Required 2Complete this question by entering your answers in the tabs below.NoRequired 2 >1Transaction1Required 3Record any necessary adjusting entry to write down inventory from cost to net realizable value. (If no entry is required for atransaction/event, select "No Journal Entry Required" in the first account field.)Answer is not complete.Cost of Goods SoldInventoryRequired 4General Journal✓✓Debit49,000✔CreditPICCOLLAGE Complete this question by entering your answers in the tabs below.Required 1 Required 2 Required 3RevenuesDetermine the financial statement effects of using lower of cost and net realizable value to report inventory. (Make sure to enter amounts leading to account reductionwith a minus sign.)49,000 InventoryAssetsRequired 4(49,000) Inventory> Answer is complete but not entirely correct.XIncome Statement:Expenses49,000 Cost of Goods SoldBalance Sheet:49,000< Required 3LiabilitiesCost of Goods SoldRequired 4 >3Net Income(49,000)Stockholders'Equity(49,000)

1. In Income statement, there will be no effect on Revenue side due to decrease in the value of…

Answered: Determine the financial statement…

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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A local Chevrolet dealership carries the following types of vehicles:

Inventory Items	Quantity	Unit Cost	Unit NRV
Vans	3	$18,000	$16,000
Trucks	6	16,200	15,200
2-door sedans	2	11,200	13,200
4-door sedans	7	15,200	18,200
Sports cars	3	28,000	31,000
SUVs	5	26,400	19,000

Because of recent increases in gasoline prices, the car dealership has noticed a reduced demand for its SUVs, vans, and trucks.

Required:

4. Determine the financial statement effects of using lower of cost and net realizable value to report inventory. (Make sure to enter amounts leading to account reduction with a minus sign.)

I need assistance solving Requirement 4 (specifically, the four boxes with a red 'X', which are currently not correct). Requirements 1 through 3 have already been answered correctly -- a screenshot is attached to show those values. For Requirement 4, the text presets available to choose from are as follow:

No Journal Entry Required
Accounts Payable
Accounts Receivable
Advertising Expense
Allowance for Uncollectible Accounts
Buildings
Cash
Common Stock
Cost of Goods Sold
Deferred Revenue
Delivery Expense
Entertainment Expense
Equipment
Freight-In
Gain
Income Tax Expense
Insurance Expense
Interest Expense
Interest Payable
Interest Receivable
Interest Revenue
Inventory
Land
Legal Fees Expense
Notes Payable
Notes Receivable
Postage Expense
Prepaid Advertising
Prepaid Insurance
Prepaid Rent
Purchase Discounts
Purchase Returns
Purchases
Rent Expense
Repairs and Maintenance Expense
Retained Earnings
Salaries Expense
Salaries Payable
Sales Allowances
Sales Discounts
Sales Returns
Sales Revenue
Service Fee Expense
Service Revenue
Supplies
Supplies Expense
Utilities Expense
Utilities Payable

Required 1
Inventory
Items
Complete this question by entering your answers in the tabs below.
Required 1 Required 2
Total cost
Complete this question by entering your answers in the tabs below.
Total
Compute the total cost of the entire inventory.
Vans
Trucks
2-door sedans
4-door sedans
Sports cars
SUVS
Required 2
Cost or
NRV
Determine whether each inventory item would be reported at cost or net realizable value (NRV). Enter the amount of either
the Unit Cost or Unit NRV in the "Lower of Cost and NRV per unit" column and then multiply this amount by the quantity of
each inventory item and enter it in the Total column.
NRV
NRV
Cost
Cost
Cost
NRV
✓
✓
✓
$ 496,000
✓
✓
✓
Required 3 Required 4
Lower of
Cost and
NRV per
unit
16,000 $
15,200 ✓
11,200✔
15,200✔
28,000✔
19,000✔
Total
48,000✔
91,200✔
22,400✔
106,400✔
84,000
95.000
447,000
Required 3
< Required 1
Required 4
Required 3 >
< Required 1
Required 1 Required 2
Complete this question by entering your answers in the tabs below.
No
Required 2 >
1
Transaction
1
Required 3
Record any necessary adjusting entry to write down inventory from cost to net realizable value. (If no entry is required for a
transaction/event, select "No Journal Entry Required" in the first account field.)
Answer is not complete.
Cost of Goods Sold
Inventory
Required 4
General Journal
✓
✓
Debit
49,000✔
Credit
PICCOLLAGE

Complete this question by entering your answers in the tabs below.
Required 1 Required 2 Required 3
Revenues
Determine the financial statement effects of using lower of cost and net realizable value to report inventory. (Make sure to enter amounts leading to account reduction
with a minus sign.)
49,000 Inventory
Assets
Required 4
(49,000) Inventory
> Answer is complete but not entirely correct.
X
Income Statement:
Expenses
49,000 Cost of Goods Sold
Balance Sheet:
49,000
< Required 3
Liabilities
Cost of Goods Sold
Required 4 >
3
Net Income
(49,000)
Stockholders'
Equity
(49,000)

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