The inventory of Royal Decking consisted of five products. Information about the December 31, 2021, inventory is as follows: Per Unit Replacement Cost $36 71 56 71 29 Product Cost A $ 41 B 81 с 41 101 21 D E Selling Price $ 61 101 81 131 31 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 30% 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? (Do not round intermediate calculations. Round final answers to 2 decimal places.)
The inventory of Royal Decking consisted of five products. Information about the December 31, 2021, inventory is as follows: Per Unit Replacement Cost $36 71 56 71 29 Product Cost A $ 41 B 81 с 41 101 21 D E Selling Price $ 61 101 81 131 31 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 30% 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? (Do not round intermediate calculations. Round final answers to 2 decimal places.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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![Exercise 9-5 (Algo) Lower of cost or market [LO9-1]
The inventory of Royal Decking consisted of five products. Information about the December 31, 2021, inventory is as follows:
Per Unit
Product Cost
$ 41
A
B
81
41
101
21
с
D
E
Product Cost
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
30% of selling price.
A $
B
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? (Do not round intermediate calculations. Round final answers to 2 decimal places.)
Hobb
с
Replacement Cost
$36
71
56
D
E
71
29
Replacement
cost
41 S
81
41
101
21
Selling Price
$ 61
101
81
131
31
36
71
56
71
29
NRV
NRV - NP
Market
Per Unit
Inventory
Value](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F05c29da8-5e07-472c-a295-a56e55cdcfad%2Fd0b816c9-58ed-40f1-a36d-a9ab933622bd%2Ffw6xkcg_processed.png&w=3840&q=75)
Transcribed Image Text:Exercise 9-5 (Algo) Lower of cost or market [LO9-1]
The inventory of Royal Decking consisted of five products. Information about the December 31, 2021, inventory is as follows:
Per Unit
Product Cost
$ 41
A
B
81
41
101
21
с
D
E
Product Cost
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
30% of selling price.
A $
B
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? (Do not round intermediate calculations. Round final answers to 2 decimal places.)
Hobb
с
Replacement Cost
$36
71
56
D
E
71
29
Replacement
cost
41 S
81
41
101
21
Selling Price
$ 61
101
81
131
31
36
71
56
71
29
NRV
NRV - NP
Market
Per Unit
Inventory
Value
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