Question

please answer this accounting question

equirements wmryoursoruions anuu mese suPpormg caICuraious must ve prepareo wtran xcer spreadsheet. You must submit one printed copy of the Excel spreadsheet which contains your case solution and a second printed copy displaying the formulas contained in each cell of your spreadsheet. Excel Case # 2 Raider Industries must follow the Lower of Cost or Net Realizable Value (LCNRV) Rule for its inventory. The following information was taken from Raider's inventory records as of December 31, 2019: Selling Price per Unit 15.00 Product ID Quantity on Hand 3,250 4,000 Cost Number Item # 101 per Unit 12.00 Item # 102 60.00 55.00 Item #103 6,000 7,00 8.00 Item #104 2,700 4.00 6.00 Item #105 Item # 201 Item #202 Item # 203 500 75.00 80.00 600 80.00 90,00 1,500 4.000 5.00 5.50 16.00 17.00 Raider has the following costs to sell associated with all of its products: 1. Sales commission of 10 % of the selling price for each product 2. Packaging and delivery costs of 5% of the cost of each product Requirements: Complete each of the following independent requirements: a) Determine the carrying value of inventory at 12/31/19 assuming that Raider applies the LCNRV Rule to each specific product in its inventory. Also, assuming that Raider would record any loss recognized as a separate line item in its income statement, determine the amount of the loss (if any) that Raider would record for 2019 b) Determine the carrying value of inventory at 12/31/19 assuming that Raider applies the LCNRV Rule to its total inventory. Also, assuming that Raider would record any loss recognized as a separate line item in its income statement, determine the amount of the loss (if any) that Raider would record for 2019 msi

Answer 1

ddear student in this question calculated cost by multiplying the units with cost price and selling price by multiplying units with sselling price and considered individually item wise LCNRV (lower of cost or net realizable value) and made the summation as the carrying value of inventory at 12/31/2019. and the difference between cost and LCNRV (If it is lower) as loss.

a)	1	2	3	4	5	6	7	8	9	10	11	12
	product id no	quantity	cost p/u	total cost 2*3	selling price p/u	total sales 2*5	selling commission 6*10%	packing and delivery cost 4*5%	net realizable value 6-(7+8)	LCNRV (which ever lower in column 4 and 9)	carrying value of inventory 12/31/19	Loss 4-10
	Item # 101	3250	12	39000	15	48750	4875	1950	41925	39000	39000	0
	Item # 102	4000	60	240000	55	220000	22000	12000	186000	186000	186000	54000
	Item # 103	6000	7	42000	8	48000	4800	2100	41100	41100	41100	900
	Item # 104	2700	4	10800	6	16200	1620	540	14040	10800	10800	0
	Item # 105	500	75	37500	80	40000	4000	1875	34125	34125	34125	3375
	Item # 201	600	80	48000	90	54000	5400	2400	46200	46200	46200	1800
	Item # 202	1500	5	7500	5.5	8250	825	375	7050	7050	7050	450
	Item # 203	4000	16	64000	17	68000	6800	3200	58000	58000	58000	6000
											422275	66525
a)	Answers	The carrying value of inventory at 12/31/2019						422275
		Loss (the loss if LCNRV is lower than cost)						66525

b)	1	2	3	4	5	6	7	8	9
	product id no	quantity	cost p/u	total cost 2*3	selling price p/u	total sales 2*5	selling commission 6*10%	packing and delivery cost 4*5%	net realizable value 6-(7+8)
	Item # 101	3250	12	39000	15	48750	4875	1950	41925
	Item # 102	4000	60	240000	55	220000	22000	12000	186000
	Item # 103	6000	7	42000	8	48000	4800	2100	41100
	Item # 104	2700	4	10800	6	16200	1620	540	14040
	Item # 105	500	75	37500	80	40000	4000	1875	34125
	Item # 201	600	80	48000	90	54000	5400	2400	46200
	Item # 202	1500	5	7500	5.5	8250	825	375	7050
	Item # 203	4000	16	64000	17	68000	6800	3200	58000
				488800					428440
	Answers	The carrying value of inventory at 12/31/2019						428440
		Loss (488800-428440) (the loss if LCNRV is lower than cost)						60360

din the above answer summation of cost compared with summation of net realizable value and lower is considered as carrying value of inventory at 12/31/2019 and the difference between cost and LCNRV is take as loss.