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Garcia Company's inventory at the end of the year was recorded in its accounting records at $17,800. Due to technological changes in the market, Garcia would be able to replace its inventory for $16,500. Using the lower of cost or market method, what amount should Garcia report for inventory on its balance sheet at the end of the year? Prepare the journal entry required to value the inventory at the lower of cost or market.

Garcia Company's inventory at the end of the year was recorded in its accounting records at $17,800. Due to technological changes in the market, Garcia would be able to replace its inventory for $16,500. Using the lower of cost or market method, what amount should Garcia report for inventory on its balance sheet at the end of the year? Prepare the journal entry required to value the inventory at the lower of cost or market.

FINANCIAL ACCOUNTING
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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Garcia Company's inventory at the end of the year was recorded in its accounting records at $17,800. Due to technological changes in the market, Garcia would be able to replace its inventory for $16,500. Using the lower of cost or market method, what amount should Garcia report for inventory on its balance sheet at the end of the year? Prepare the journal entry required to value the inventory at the lower of cost or market.
Transcribed Image Text:Garcia Company's inventory at the end of the year was recorded in its accounting records at $17,800. Due to technological changes in the market, Garcia would be able to replace its inventory for $16,500. Using the lower of cost or market method, what amount should Garcia report for inventory on its balance sheet at the end of the year? Prepare the journal entry required to value the inventory at the lower of cost or market.
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