Home Furnishings reports inventory using the lower- of-cost-or-market method. Below is information related to its year-end inventory. Furniture: quantity = 100, cost = $75, market = $90 Electronics: quantity = 40, cost = $300, market = $250 Calculate ending inventory using the lower-of-cost- or-market method.

Home Furnishings reports inventory using the lower- of-cost-or-market method. Below is information related to its year-end inventory. Furniture: quantity = 100, cost = $75, market = $90 Electronics: quantity = 40, cost = $300, market = $250 Calculate ending inventory using the lower-of-cost- or-market method.

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter7: Inventories: Cost Measurement And Flow Assumptions

Section: Chapter Questions

Problem 11RE: Jessie Stores uses the periodic system of calculating inventory. The following information is...

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Pappas Appliances uses the periodic inventory system. Details regarding the inventory of appliances at January 1, purchases invoices during the year, and the inventory count at December 31 are summarized as follows: Instructions 1. Determine the cost of the inventory on December 31 by the first-in, first-out method. Present data in columnar form, using the following headings: If the inventory of a particular model comprises one entire purchase plus a portion of another purchase acquired at a different unit cost, use a separate line for each purchase. 2. Determine the cost of the inventory on December 31 by the last-in, first-out method, following the procedures indicated in (1). 3. Determine the cost of the inventory on December 31 by the weighted average cost method, using the columnar headings indicated in (1). 4. Discuss which method (FIFO or LIFO) would be preferred for income tax purposes in periods of (a) rising prices and (b) declining prices.
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