Hi expert please give me answer general accounting question XYZ Company manufactures wooden toys. At December 31, 2024,their inventory of toy trains was valued at $80 per unit. On January10, 2025, the market price dropped to $65 per unit. Additionally, XYZneeds to spend $10 per unit on finishing and packaging before thetoys can be sold. What is the net realizable value and inventorywrite-down (loss) amount per unit?

Step 1: Definition of Net Realizable Value (NRV)Net Realizable Value (NRV) is the estimated selling…

Answered: XYZ Company manufactures wooden toys.…

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter21: Supply Chains And Working Capital Management

Section: Chapter Questions

Problem 10MC

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A company normally sells its product for $20 per unit. However, the selling price has fallen to $15 per unit. This company's current FIFO inventory consists of 200 units purchased at $16 per unit. Net realizable value has now fallen to $13 per unit. What is the amount of the lower cost of market adjustment the company must make as a result of this decline in value?
A product is currently reported on the balance sheet at a cost of $29. The selling price of the product is currently $30 and disposal costs are $3. If the company had to buy the product today, it would pay $28. The product has a normal profit margin on sales of 30%. What amount should the product be valued at under each of the following methods? Lower of Cost or Market (LCM) Lower of Cost of Net Realizable Value (LCNRV)
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A company normally sells its product for $25 per unit. This company's current inventory consists of 250 units purchased at $18 per unit. Replacement cost has now fallen to $15 per unit. Calculate the value of this company's inventory at a lower cost or market.
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