LCNRV: LCNRV refers to the lower-of-cost-and-net realizable value. Inventories are generally recorded at cost. When there is evidence that there is a disposal of the usefulness of inventory goods in the ordinary course of business being lesser than cost, then the difference will be recognized as a loss in the current period. The inventory will be stated as the “net realizable value” in the financial statements. (a) (1) To determine the amount of inventory to be reported in the balance sheet of S Corporation.

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Answer 1

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Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

Chapter 9, Problem 4CA

To determine

LCNRV: LCNRV refers to the lower-of-cost-and-net realizable value. Inventories are generally recorded at cost. When there is evidence that there is a disposal of the usefulness of inventory goods in the ordinary course of business being lesser than cost, then the difference will be recognized as a loss in the current period. The inventory will be stated as the “net realizable value” in the financial statements.

(a)

(1)

To determine the amount of inventory to be reported in the balance sheet of S Corporation.

To determine

(2)

To determine the reason for using the rule of lower-of-cost-or-market to report inventory.

To determine

(b)

To determine the effect of ending inventory and cost of goods sold by using the LIFO inventory method instead of average cost inventory method.

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The beginning inventory at Smith Co. and data on purchases and sales for a three-month period ending June 30 are... Date Transaction Numberof Units Per Unit Total Apr. 3 Inventory 48 $450 $21,600 8 Purchase 96 540 51,840 11 Sale 64 1,500 96,000 30 Sale 40 1,500 60,000 May 8 Purchase 80 600 48,000 10 Sale 48 1,500 72,000 19 Sale 24 1,500 36,000 28 Purchase 80 660 52,800 June 5 Sale 48 1,575 75,600 16 Sale 64 1,575 100,800 21 Purchase 144 720 103,680 28 Sale 72 1,575 113,400 Record inventory, purchases, cost of merchandise sold data in perpetual invetory record similar to the one illutrated in exhibit 3 using FIFO. Under FIFO if units at two different costs eneter the units with the lower unit cost first in the cost of goods sold unit cost column and in the inventory unit cost column.

Summit Manufacturing has a standard costing system. The following data are available for October: • • Actual quantity of direct materials purchased: 40,000 pounds Standard price of direct materials: $6 per pound Material price variance: $4,800 unfavorable Material quantity variance: $3,200 favorable What is the actual price per pound of direct materials purchased in October?

Answer 2

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Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

Chapter 9, Problem 4CA

To determine

LCNRV: LCNRV refers to the lower-of-cost-and-net realizable value. Inventories are generally recorded at cost. When there is evidence that there is a disposal of the usefulness of inventory goods in the ordinary course of business being lesser than cost, then the difference will be recognized as a loss in the current period. The inventory will be stated as the “net realizable value” in the financial statements.

(a)

(1)

To determine the amount of inventory to be reported in the balance sheet of S Corporation.

To determine

(2)

To determine the reason for using the rule of lower-of-cost-or-market to report inventory.

To determine

(b)

To determine the effect of ending inventory and cost of goods sold by using the LIFO inventory method instead of average cost inventory method.

Expert Solution & Answer

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Answer 3

Question

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

Chapter 9, Problem 4CA

To determine

LCNRV: LCNRV refers to the lower-of-cost-and-net realizable value. Inventories are generally recorded at cost. When there is evidence that there is a disposal of the usefulness of inventory goods in the ordinary course of business being lesser than cost, then the difference will be recognized as a loss in the current period. The inventory will be stated as the “net realizable value” in the financial statements.

(a)

(1)

To determine the amount of inventory to be reported in the balance sheet of S Corporation.

To determine

(2)

To determine the reason for using the rule of lower-of-cost-or-market to report inventory.

To determine

(b)

To determine the effect of ending inventory and cost of goods sold by using the LIFO inventory method instead of average cost inventory method.

Expert Solution & Answer

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Check out a sample textbook solution

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Answer 4

Question

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

Chapter 9, Problem 4CA

To determine

LCNRV: LCNRV refers to the lower-of-cost-and-net realizable value. Inventories are generally recorded at cost. When there is evidence that there is a disposal of the usefulness of inventory goods in the ordinary course of business being lesser than cost, then the difference will be recognized as a loss in the current period. The inventory will be stated as the “net realizable value” in the financial statements.

(a)

(1)

To determine the amount of inventory to be reported in the balance sheet of S Corporation.

To determine

(2)

To determine the reason for using the rule of lower-of-cost-or-market to report inventory.

To determine

(b)

To determine the effect of ending inventory and cost of goods sold by using the LIFO inventory method instead of average cost inventory method.

Expert Solution & Answer

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Check out a sample textbook solution

See solution

Answer 5

Chapter 9, Problem 4CA

To determine

LCNRV: LCNRV refers to the lower-of-cost-and-net realizable value. Inventories are generally recorded at cost. When there is evidence that there is a disposal of the usefulness of inventory goods in the ordinary course of business being lesser than cost, then the difference will be recognized as a loss in the current period. The inventory will be stated as the “net realizable value” in the financial statements.

(a)

(1)

To determine the amount of inventory to be reported in the balance sheet of S Corporation.

To determine

(2)

To determine the reason for using the rule of lower-of-cost-or-market to report inventory.

To determine

(b)

To determine the effect of ending inventory and cost of goods sold by using the LIFO inventory method instead of average cost inventory method.

Answer 6

Chapter 9, Problem 4CA

To determine

LCNRV: LCNRV refers to the lower-of-cost-and-net realizable value. Inventories are generally recorded at cost. When there is evidence that there is a disposal of the usefulness of inventory goods in the ordinary course of business being lesser than cost, then the difference will be recognized as a loss in the current period. The inventory will be stated as the “net realizable value” in the financial statements.

(a)

(1)

To determine the amount of inventory to be reported in the balance sheet of S Corporation.

Answer 7

Chapter 9, Problem 4CA

To determine

LCNRV: LCNRV refers to the lower-of-cost-and-net realizable value. Inventories are generally recorded at cost. When there is evidence that there is a disposal of the usefulness of inventory goods in the ordinary course of business being lesser than cost, then the difference will be recognized as a loss in the current period. The inventory will be stated as the “net realizable value” in the financial statements.

(a)

(1)

To determine the amount of inventory to be reported in the balance sheet of S Corporation.

Answer 8

To determine

(2)

To determine the reason for using the rule of lower-of-cost-or-market to report inventory.

Answer 9

To determine

(2)

To determine the reason for using the rule of lower-of-cost-or-market to report inventory.

Answer 10

To determine

(b)

To determine the effect of ending inventory and cost of goods sold by using the LIFO inventory method instead of average cost inventory method.

Answer 11

To determine

(b)

To determine the effect of ending inventory and cost of goods sold by using the LIFO inventory method instead of average cost inventory method.

Answer 12

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Answer 13

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Answer 14

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Answer 15

Ch. 9 - Prob. 1Q Ch. 9 - Prob. 2Q Ch. 9 - 3. What approaches may be employed in applying...Ch. 9 - Prob. 4Q Ch. 9 - Prob. 5Q Ch. 9 - Prob. 6Q Ch. 9 - Prob. 7Q Ch. 9 - Prob. 8Q Ch. 9 - Prob. 9Q Ch. 9 - Prob. 11Q

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(2)

To determine the reason for using the rule of lower-of-cost-or-market to report inventory.

(b)

To determine the effect of ending inventory and cost of goods sold by using the LIFO inventory method instead of average cost inventory method.

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Chapter 9 Solutions

Concept explainers

Videos

(2) To determine the reason for using the rule of lower-of-cost-or-market to report inventory.

(b) To determine the effect of ending inventory and cost of goods sold by using the LIFO inventory method instead of average cost inventory method.

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Chapter 9 Solutions

(2)

To determine the reason for using the rule of lower-of-cost-or-market to report inventory.

(b)

To determine the effect of ending inventory and cost of goods sold by using the LIFO inventory method instead of average cost inventory method.