Problem #5(Lower of Cost or Market - LCM)Melissa's Wing-Bang Washing Machine Mfg. makes washing machines. Most of Melissa'swashing machines are standard models and are sold on the basis of catalog prices. The company hasadopted a lower of FIFO cost or market approach applied to inventory on an individual item basis.At December 31, 2021 the following finished washing machines appear in the company's inventory.Finished Washers - Models -->A$700 $BD800 $2021 catalog selling priceFIFO cost per inventory listEst. cost to re-manufacture (REPCO)Costs of disposal750 $1,0002$460 $465 $640 $740440 $480 $630 $810150 $160 $180 $200"Normal"gross profit margin# of units in 12-31-21 inventory15%20%22%24%400200100100Calculate the:a. "Designated" market for each itemb. LCM unit cost assigned to each item @ 12-31-21c. LCM total inventory valued. Total amount of the inventory "write-down" @ 12-31-21

Name: Problem #5(Lower of Cost or Market - LCM)Melissa's Wing-Bang Washing
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Description: Problem #5(Lower of Cost or Market - LCM)Melissa's Wing-Bang Washing Machine Mfg. makes washing machines. Most of Melissa'swashing machines are standard models and are sold on the basis of catalog prices. The company hasadopted a lower of FIFO cost

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Problem #5 (Lower of Cost or Market - LCM) Melissa's Wing-Bang Washing Machine Mfg. makes washing machines. Most of Melissa's washing machines are standard models and are sold on the basis of catalog prices. The company has adopted a lower of FIFO cost or market approach applied to inventory on an individual item basis. At December 31, 2021 the following finished washing machines appear in the company's inventory. Finished Washers - Models --> 2021 catalog selling price FIFO cost per inventory list Est. cost to re-manufacture (REPCO) A 700 $ $ B 750 $ 465 $ 800 $ 640 $ 1,000 460 $ 740 440 $ 480 $ 630 $ 810 Costs of disposal 2$ 150 $ 160 $ 180 $ 200 "Normal" gross profit margin # of units in 12-31-21 inventory 159 20% 22% 24% 400 200 100 100 Calculate the: a. "Designated" market for each item b. LCM unit cost assigned to each item @ 12-31-21 c. LCM total inventory value

Problem #5 (Lower of Cost or Market - LCM) Melissa's Wing-Bang Washing Machine Mfg. makes washing machines. Most of Melissa's washing machines are standard models and are sold on the basis of catalog prices. The company has adopted a lower of FIFO cost or market approach applied to inventory on an individual item basis. At December 31, 2021 the following finished washing machines appear in the company's inventory. Finished Washers - Models --> 2021 catalog selling price FIFO cost per inventory list Est. cost to re-manufacture (REPCO) A 700 $ $ B 750 $ 465 $ 800 $ 640 $ 1,000 460 $ 740 440 $ 480 $ 630 $ 810 Costs of disposal 2$ 150 $ 160 $ 180 $ 200 "Normal" gross profit margin # of units in 12-31-21 inventory 159 20% 22% 24% 400 200 100 100 Calculate the: a. "Designated" market for each item b. LCM unit cost assigned to each item @ 12-31-21 c. LCM total inventory value

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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