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The inventory of Royal Decking consisted of five products. Information about ending inventory is as follows: Per Unit Replacement Selling Price Cost Product Cost ABCDE $ 45 $ 40 85 45 442623 $ 65 75 105 60 85 75 33 135 35 105 25 Selling costs consist of a sales commission equal to 15% of selling price and shipping costs equal to 5% of cost. The normal profit is 25% of selling price. Required: What unit value should Royal Decking use for each of its products when applying the lower of cost or market (LCM) rule to units of ending inventory? Note: Do not round intermediate calculations. Round final answers to 2 decimal places. Product Cost Replacement cost ABCDE $ 45 $ 40 85 75 45 60 105 75 25 33 NRV NRV minus NP Market Per Unit Inventory Value

The inventory of Royal Decking consisted of five products. Information about ending inventory is as follows: Per Unit Replacement Selling Price Cost Product Cost ABCDE $ 45 $ 40 85 45 442623 $ 65 75 105 60 85 75 33 135 35 105 25 Selling costs consist of a sales commission equal to 15% of selling price and shipping costs equal to 5% of cost. The normal profit is 25% of selling price. Required: What unit value should Royal Decking use for each of its products when applying the lower of cost or market (LCM) rule to units of ending inventory? Note: Do not round intermediate calculations. Round final answers to 2 decimal places. Product Cost Replacement cost ABCDE $ 45 $ 40 85 75 45 60 105 75 25 33 NRV NRV minus NP Market Per Unit Inventory Value

FINANCIAL ACCOUNTING
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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The inventory of Royal Decking consisted of five products. Information about ending inventory is as follows: Per Unit Replacement Selling Price Cost Product Cost ABCDE $ 45 $ 40 85 45 442623 $ 65 75 105 60 85 75 33 135 35 105 25 Selling costs consist of a sales commission equal to 15% of selling price and shipping costs equal to 5% of cost. The normal profit is 25% of selling price. Required: What unit value should Royal Decking use for each of its products when applying the lower of cost or market (LCM) rule to units of ending inventory? Note: Do not round intermediate calculations. Round final answers to 2 decimal places. Product Cost Replacement cost ABCDE $ 45 $ 40 85 75 45 60 105 75 25 33 NRV NRV minus NP Market Per Unit Inventory Value
Transcribed Image Text:The inventory of Royal Decking consisted of five products. Information about ending inventory is as follows: Per Unit Replacement Selling Price Cost Product Cost ABCDE $ 45 $ 40 85 45 442623 $ 65 75 105 60 85 75 33 135 35 105 25 Selling costs consist of a sales commission equal to 15% of selling price and shipping costs equal to 5% of cost. The normal profit is 25% of selling price. Required: What unit value should Royal Decking use for each of its products when applying the lower of cost or market (LCM) rule to units of ending inventory? Note: Do not round intermediate calculations. Round final answers to 2 decimal places. Product Cost Replacement cost ABCDE $ 45 $ 40 85 75 45 60 105 75 25 33 NRV NRV minus NP Market Per Unit Inventory Value
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