Novelli's Nursery has developed the following data in order to calculate the lower of cost or net realizable value for its products. The ndividual products are listed within the categories of trees.
Novelli's Nursery has developed the following data in order to calculate the lower of cost or net realizable value for its products. The ndividual products are listed within the categories of trees.
Essentials of Business Analytics (MindTap Course List)
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Author:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson
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![Novelli's Nursery has developed the following data in order to calculate the lower of cost or net realizable value for its products. The
individual products are listed within the categories of trees.
Selling
Price
Cost
Broad leaf trees:
Ash
Beech
$ 1,920
2,380
$ 1,820
1,720
Needle leaf trees:
Cedar
Fir
$ 2,740
3,300
$ 1,870
3,470
Fruit trees:
Apple
Cherry
$ 1,920
2,480
$ 1,520
1,920
The costs to sell are 10% of selling price.
Required:
Determine the reported inventory value assuming the lower of cost or net realizable value rule is applied to individual trees.
Product
Lower of
Cost
NRV
Cost or NRV
Ash
Beech
Cedar
Fir
Apple
Cherry
Inventory value
$
0](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fd357412c-7ce8-400e-bb25-57f41d18f1e6%2Fd0e96f4c-5dd4-4a9b-8a8e-2a0f0368999c%2Flw15g1n_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Novelli's Nursery has developed the following data in order to calculate the lower of cost or net realizable value for its products. The
individual products are listed within the categories of trees.
Selling
Price
Cost
Broad leaf trees:
Ash
Beech
$ 1,920
2,380
$ 1,820
1,720
Needle leaf trees:
Cedar
Fir
$ 2,740
3,300
$ 1,870
3,470
Fruit trees:
Apple
Cherry
$ 1,920
2,480
$ 1,520
1,920
The costs to sell are 10% of selling price.
Required:
Determine the reported inventory value assuming the lower of cost or net realizable value rule is applied to individual trees.
Product
Lower of
Cost
NRV
Cost or NRV
Ash
Beech
Cedar
Fir
Apple
Cherry
Inventory value
$
0
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