Pronghorn Co. follows the practice of valuing its inventory at the lower-of-cost-or-market. The following information is available fr the company's inventory records as of December 31, 2025. Item A B C D E Quantity Unit Cost (a) 1,600 1,300 1,500 1,500 1,900 $9.00 9.84 6.72 4.56 7.68 Replacement Cost/Unit $10.08 9.48 6.48 5.04 7.56 Estimated Selling Completion & Disposal Price/Unit Cost/Unit $12.60 11.28 8.64 7.56 8.04 $1.80 1.08 1.38 0.96 0.84 Normal Profit Margin/Unit $2.16 1.44 0.72 1.80 1.20 Greg Forda is an accounting clerk in the accounting department of Pronghorn Co., and he cannot understand why the market value keeps changing from replacement cost to net realizable value to something that he cannot even figure out. Greg is very confused, ar he is the one who records inventory purchases and calculates ending inventory. You are the manager of the department and an accountant. Calculate the lower-of-cost-or-market using the individual-item approach. (Round answers to 2 decimal places, e.g. 78.73.)
Pronghorn Co. follows the practice of valuing its inventory at the lower-of-cost-or-market. The following information is available fr the company's inventory records as of December 31, 2025. Item A B C D E Quantity Unit Cost (a) 1,600 1,300 1,500 1,500 1,900 $9.00 9.84 6.72 4.56 7.68 Replacement Cost/Unit $10.08 9.48 6.48 5.04 7.56 Estimated Selling Completion & Disposal Price/Unit Cost/Unit $12.60 11.28 8.64 7.56 8.04 $1.80 1.08 1.38 0.96 0.84 Normal Profit Margin/Unit $2.16 1.44 0.72 1.80 1.20 Greg Forda is an accounting clerk in the accounting department of Pronghorn Co., and he cannot understand why the market value keeps changing from replacement cost to net realizable value to something that he cannot even figure out. Greg is very confused, ar he is the one who records inventory purchases and calculates ending inventory. You are the manager of the department and an accountant. Calculate the lower-of-cost-or-market using the individual-item approach. (Round answers to 2 decimal places, e.g. 78.73.)
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter6: Cost Of Goods Sold And Inventory
Section: Chapter Questions
Problem 37BE: Lower of Cost or Market Garcia Company uses FIFO, and its inventory at the end of the year was...
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Calculate the lower-of-cost-or-market using the individual-item approach for:
Item A, Item B, Item C, Item D, Item E
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