Lower-of-Cost-or-Market Inventory Data on the physical inventory of Ashwood Products Company as of December 31 follow: Description InventoryQuantity Market Value per Unit (Net Realizable Value) B12 38     $ 57     E41 18     180     G19 33     126     L88 18     550     N94 400     7     P24 90     18     R66 8     250     T33 140     20     Z16 15     752     Quantity and cost data from the last purchases invoice of the year and the next-to-the-last purchases invoice are summarized as follows:   LastPurchases Invoice   Next-to-the-LastPurchases Invoice Description QuantityPurchased UnitCost   QuantityPurchased UnitCost B12 30     $ 60       30     $ 59     E41 35     178       20     180     G19 20     128       25     129     L88 10     563       10     560     N94 500     8       500     7     P24 80     22       50     21     R66 5     248       4     260     T33 100     21       100     19     Z16 10     750       9     745     Required: Determine the inventory at cost and also at the lower of cost or market applied on an item-by-item basis, using the first-in, first-out method. Record the appropriate unit costs on the inventory sheet, and complete the pricing of the inventory. When there are two different unit costs applicable to an item, proceed as follows: Insert the quantity and unit cost of the last purchase. On the following line, insert the quantity and unit cost of the next-to-the-last purchase. Total the cost and market columns and insert the lower of the two totals in the LCM column. The first item on the inventory sheet has been completed as an example. Inventory SheetDecember 31 Description Inventory Quantity Cost Per Unit Market Valueper Unit(Net RealizableValue) Total Cost Market LCM B12 38 30 $60 $57 $1,800 $1,710       8 59 57 472 456             2,272 2,166 $2,166 E41 18             G19 33                                             L88 18                                             N94 400             P24 90                                             R66 8                                             T33 140                                             Z16 15                                             Total         $ $ $

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Chapter1: Financial Statements And Business Decisions
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Lower-of-Cost-or-Market Inventory

Data on the physical inventory of Ashwood Products Company as of December 31 follow:


Description
Inventory
Quantity
Market Value per Unit (Net Realizable Value)
B12 38     $ 57    
E41 18     180    
G19 33     126    
L88 18     550    
N94 400     7    
P24 90     18    
R66 8     250    
T33 140     20    
Z16 15     752    

Quantity and cost data from the last purchases invoice of the year and the next-to-the-last purchases invoice are summarized as follows:

  Last
Purchases Invoice
  Next-to-the-Last
Purchases Invoice

Description
Quantity
Purchased
Unit
Cost
  Quantity
Purchased
Unit
Cost
B12 30     $ 60       30     $ 59    
E41 35     178       20     180    
G19 20     128       25     129    
L88 10     563       10     560    
N94 500     8       500     7    
P24 80     22       50     21    
R66 5     248       4     260    
T33 100     21       100     19    
Z16 10     750       9     745    

Required:

Determine the inventory at cost and also at the lower of cost or market applied on an item-by-item basis, using the first-in, first-out method. Record the appropriate unit costs on the inventory sheet, and complete the pricing of the inventory. When there are two different unit costs applicable to an item, proceed as follows:

  1. Insert the quantity and unit cost of the last purchase.
  2. On the following line, insert the quantity and unit cost of the next-to-the-last purchase.
  3. Total the cost and market columns and insert the lower of the two totals in the LCM column.

The first item on the inventory sheet has been completed as an example.

Inventory Sheet
December 31
Description Inventory Quantity Cost Per Unit Market Value
per Unit
(Net Realizable
Value)
Total
Cost Market LCM
B12 38 30 $60 $57 $1,800 $1,710  
    8 59 57 472 456  
          2,272 2,166 $2,166
E41 18            
G19 33            
               
               
L88 18            
               
               
N94 400            
P24 90            
               
               
R66 8            
               
               
T33 140            
               
               
Z16 15            
               
               
Total         $ $ $
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