Home Stop sells two product categories, furniture and accessories. Information pertaining to its 2021 year-end inventory is as follows: Inventory, by Product Category Quantity Per Unit Cost Market Furniture: Chairs 40 $ 44 $ 50 Desks 70 92 77 Tables 80 103 111 Accessories: Rugs 40 79 67 Lamps 20 41 37
Home Stop sells two product categories, furniture and accessories. Information pertaining to its 2021 year-end inventory is as follows:
| Inventory, by Product Category |
Quantity | Per Unit Cost |
Market | |||||||
| Furniture: | ||||||||||
| Chairs | 40 | $ | 44 | $ | 50 | |||||
| Desks | 70 | 92 | 77 | |||||||
| Tables | 80 | 103 | 111 | |||||||
| Accessories: | ||||||||||
| Rugs | 40 | 79 | 67 | |||||||
| Lamps | 20 | 41 | 37 | |||||||
Required:
1. Determine the carrying value of inventory at year-end, assuming the lower of cost or market (LCM) rule is applied to (a) individual products, (b) product categories, and (c) total inventory.
2. Assuming inventory write-downs are common for Home Stop, record any necessary year-end adjustment amount for each of the LCM applications in requirement 1.
Complete this question by entering your answers in the tabs below.
- Required 1
- Required 2
Determine the carrying value of inventory at year-end, assuming the lower of cost or market (LCM) rule is applied to (a) individual products, (b) product categories, and (c) total inventory.
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- Required 1
- Required 2
Assuming inventory write-downs are common for Home Stop, record any necessary year-end adjustment amount for each of the LCM applications in requirement 1.
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