Exercise 9-2
Ivanhoe Company uses the LCNRV method, on an individual-item
basis, in pricing its inventory items. The inventory at December
31, 2017, consists of products D, E, F, G, H, and I. Relevant per
unit data for these products appear below.
Item D |
Item E |
Item F |
Item G |
Item H |
Item I |
|||||||||||||
Estimated selling price | $144 | $132 | $114 | $108 | $132 | $108 | ||||||||||||
Cost | 90 | 96 | 96 | 96 | 60 | 43 | ||||||||||||
Cost to complete | 36 | 36 | 30 | 42 | 36 | 36 | ||||||||||||
Selling costs | 12 | 22 | 12 | 24 | 12 | 24 |
Using the LCNRV rule, determine the proper unit value for balance
sheet reporting purposes at December 31, 2017, for each of the
inventory items above.
Item D | $ | ||
Item E | $ | ||
Item F | $ | ||
Item G | $ | ||
Item H | $ | ||
Item I | $ |
Estimated selling price | Cost to complete | Selling costs | NRV | Cost | LCNRV | ||
Item D | 144 | 36 | 12 | 96 | 90 | 90 | |
Item E | 132 | 36 | 22 | 74 | 96 | 74 | |
Item F | 114 | 30 | 12 | 72 | 96 | 72 | |
Item G | 108 | 42 | 24 | 42 | 96 | 42 | |
Item H | 132 | 36 | 12 | 84 | 60 | 60 | |
Item I | 108 | 36 | 24 | 48 | 43 | 43 | |
Note: NRV = Estimated selling price-Cost to complete-Selling costs |
Exercise 9-2 Ivanhoe Company uses the LCNRV method, on an individual-item basis, in pricing its inventory items. The inv...
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