Lower-of-Cost-or-Market Inventory On the basis of the following data, determine the value of the inventory at the lower of cost or market. Assemble the data in the form illustrated in Exhibit 10. Product InventoryQuantity Cost PerUnit Market Value per Unit(Net Realizable Value) Class 1: Model A 300 $140 $125 Model B 500 90 112 Model C 150 60 59 Class 2: Model D 800 120 115 Model E 400 140 145 a. Determine the value of the inventory at the lower of cost or market applied to each item in the inventory. Inventory at the Lower of Cost or Market Product InventoryQuantity Costper Unit Market Valueper Unit(Net Realizable Value) Cost Market Lower of Cost or Market Model A $ $ $ $ $ Model B Model C Model D Model E Total $ $ $ b. Determine the value of the inventory at the lower of cost or market applied to each class of inventory. Inventory atthe Lower of Costor Market Product InventoryQuantity Costper Unit Market Valueper Unit(Net Realizable Value) Cost Market Lower of Cost or Market Class 1: Model A $ $ $ $ Model B Model C Subtotal $ $ $ Class 2: Model D $ $ Model E Subtotal $ $ Total $ $ $ c. Determine the value of the inventory at the lower of cost or market applied to total inventory. Inventory at the Lower of Cost or Market Product InventoryQuantity Costper Unit Market Valueper Unit(Net Realizable Value) Cost Market Lower of Cost or Market Model A $ $ $ $ Model B Model C Model D Model E Total $ $ $

Lower-of-Cost-or-Market Inventory On the basis of the following data, determine the value of the inventory at the lower of cost or market. Assemble the data in the form illustrated in Exhibit 10. Product InventoryQuantity Cost PerUnit Market Value per Unit(Net Realizable Value) Class 1: Model A 300 $140 $125 Model B 500 90 112 Model C 150 60 59 Class 2: Model D 800 120 115 Model E 400 140 145 a. Determine the value of the inventory at the lower of cost or market applied to each item in the inventory. Inventory at the Lower of Cost or Market Product InventoryQuantity Costper Unit Market Valueper Unit(Net Realizable Value) Cost Market Lower of Cost or Market Model A $ $ $ $ $ Model B Model C Model D Model E Total $ $ $ b. Determine the value of the inventory at the lower of cost or market applied to each class of inventory. Inventory atthe Lower of Costor Market Product InventoryQuantity Costper Unit Market Valueper Unit(Net Realizable Value) Cost Market Lower of Cost or Market Class 1: Model A $ $ $ $ Model B Model C Subtotal $ $ $ Class 2: Model D $ $ Model E Subtotal $ $ Total $ $ $ c. Determine the value of the inventory at the lower of cost or market applied to total inventory. Inventory at the Lower of Cost or Market Product InventoryQuantity Costper Unit Market Valueper Unit(Net Realizable Value) Cost Market Lower of Cost or Market Model A $ $ $ $ Model B Model C Model D Model E Total $ $ $

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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Lower-of-Cost-or-Market Inventory

On the basis of the following data, determine the value of the inventory at the lower of cost or market. Assemble the data in the form illustrated in Exhibit 10.

Product	Inventory Quantity	Cost Per Unit	Market Value per Unit (Net Realizable Value)
Class 1:
Model A	300	$140	$125
Model B	500	90	112
Model C	150	60	59
Class 2:
Model D	800	120	115
Model E	400	140	145

a. Determine the value of the inventory at the lower of cost or market applied to each item in the inventory.



Inventory at the Lower of Cost or Market
Product	Inventory Quantity	Cost per Unit	Market Value per Unit (Net Realizable Value)	Cost	Market	Lower of Cost or Market
Model A		$	$	$	$	$
Model B
Model C
Model D
Model E
Total				$	$	$

b. Determine the value of the inventory at the lower of cost or market applied to each class of inventory.



Inventory at the Lower of Cost or Market
Product	Inventory Quantity	Cost per Unit	Market Value per Unit (Net Realizable Value)	Cost	Market	Lower of Cost or Market
Class 1:
Model A		$	$	$	$
Model B
Model C
Subtotal				$	$	$
Class 2:
Model D				$	$
Model E
Subtotal				$	$
Total				$	$	$

c. Determine the value of the inventory at the lower of cost or market applied to total inventory.



Inventory at the Lower of Cost or Market
Product	Inventory Quantity	Costper Unit	Market Value per Unit (Net Realizable Value)	Cost	Market	Lower of Cost or Market
Model A		$	$	$	$
Model B
Model C
Model D
Model E
Total				$	$	$

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