Question

In some instances, accounting principles require a departure from valuing inventories at cost alone. Determine the proper unit inventory price in the following cases, under the lower-of-cost-or-market rule. (Round answers to 2 decimal places, e.g. 52.75.)

		Cases
		1		2		3		4		5
Cost		$14.50		$14.80		$15.30		$15.40		$16.30
Net realizable value		15.70		20.20		14.00		8.90		14.50
Net realizable value less normal profit		14.10		18.70		12.56		7.40		12.70
Market (replacement cost)		16.30		19.00		13.00		10.10		16.10

		Cases
		1		2		3		4		5
Unit inventory price

Please for all 5

Answer 1

Answer : calculation of unit inventory price :

Particularls	1	1	3	4	5
Cost	$14.5	$14.8	$15.3	$15.4	$16.3
Net realizable value	15.7	20.2	14	8.9	14.5
Net realizable value less normal profit	14.1	18.7	12.56	7.4	12.7
Market (Replacement cost)	16.3	19	13	10.1	16.1
Designated market value (Middle value of Net realizable value, net realizable value less normal profit, replacement cost)	15.7	19	13	8.9	14.5
Unit inventory price (Designated market price or cost which ever is lower)	$14.5	$14.8	$13	$8.9	$14.5