Given purchase cost for 300 units = $26 each
replacement cost = $23 each
Here, the replacement cost is lower than the purchase cost. So the inventory value is to be calculated on replacement cost.
Value of inventory = 300 units * $23
= $6900
A company's normal selling price for its product is $30 per unit. However, due to market...
A company’s normal selling price for its product is $29 per unit. However, due to market competition, the selling price has fallen to $24 per unit. This company's current inventory consists of 290 units purchased at $25 per unit. Replacement cost has fallen to $22 per unit. Calculate the value of this company's inventory at the lower of cost or market.
Martinez Company's ending inventory includes the following items. Product Units Cost per Unit Market per Unit Helmets 26 $ 54 $ 58 Bats 19 82 76 Shoes 40 99 95 Uniforms 44 40 40 Compute the lower of cost or market for ending inventory applied separately to each product.
15) A company's current inventory consists of 5,000 units purchased at S6 per unit Replacement cost has now fallen to S5 per unit. What is the entry the company must record to adjust inventory to market? A) Debit Loss on Inventory $5,000; credit Cost of Goods Sold S5,000. B) Debit Merchandise Inventory $25,000; credit Cost of Goods Sold $25,000 c) Debit Merchandise Inventory $30,000; credit Cost of Goods Sold S25,000 D) Debit Cost of Goods Sold S30,000; credit Merchandise Inventory...
Falcon Co. produces a single product. Its normal selling price is $25 per unit. The variable costs are $16 per unit. Fixed costs are $18,500 for a normal production run of 5,000 units per month. Falcon received a request for a special order that would not interfere with normal sales. The order was for 1,690 units with a special price of $20 per unit. Falcon has the capacity to handle the special order, and for this order, a variable selling...
SLR Corporation has 1,400 units of each of Its two products in its year-end Inventory. Per unit data for each of the products are as follows: Product 1 Product $62 $46 60 Cost Replacement cost Selling price Selling costs Normal profit Determine the carrying value of SLR's Inventory assuming that the lower of cost or market (LCM) rule is applied to individual products. What is the before-tax income effect of the LCM adjustment? Answer is not complete. Complete this question...
Problem 9-3 (Algo) Lower of cost or market; by product and by total inventory (LO9-1] Forester Company has five products in its inventory. Information about the December 31, 2021, inventory follows. Product A Unit Cost $ 30 35 23 27 Quantity 600 1,000 900 800 700 Unit Replacement Cost $32 31 22 24 32 Unit Selling Price $36 38 28 26 33 B с D E 34 The cost to sell for each product consists of a 10 percent sales...
Herman Company has three products in its ending inventory. Specific per unit data at the end of the year for each of the products are as follows: Product Product Product $66 Cost Replacement cost Selling price Selling costs Normal profit $36 34 56 56 $106 101 136 41 46 65 15 zi Required: What unit values should Herman use for each of its products when applying the lower of cost or market (LCM) rule to ending inventory? Product Cost Replacement...
Julison Company produces a single product. The cost of producing and selling a single unit of this product at the company's normal activity level of 60,000 units per month is as follows: The normal selling price of the product is $79.80 per unit. An order has been received from an overseas customer for 2.000 units to be delivered this month at a special discounted price. This order would have no effect on the company's normal sales and would not change the...
Eley Company produces a single product. The cost of producing and selling a single unit of this product at the company's normal activity level of 40,000 units per month is as follows: Direct Materials$42.60Direct Labour$8.10Variable Manufacturing Overhead$1.10Fixed Manufacturing Overhead$17.30Variable Selling & Administrative Expense$1.8Fixed Selling & Administrative Expense$8.00The normal selling price of the product is $86.10 per unit. An order has been received from an overseas customer for 2,000 units to be delivered this month at a special discounted price. This order would...
Martinez Company's ending inventory includes the following items. Product Units Cost per Unit Market per Unit Helmets 31 $ 59 $ 63 Bats 24 113 81 Shoes 45 104 100 Uniforms 49 45 45 Compute the lower of cost or market for ending inventory applied separately to each product.