Decker Company has five products in its inventory. Information about the December 31, 2021, inventory follows....

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Decker Company has five products in its inventory. Information about the December 31, 2021, inventory follows....

Decker Company has five products in its inventory. Information about the December 31, 2021, inventory follows.

Product	Quantity	Unit Cost	Unit Selling Price
A	1,350	$17	$24
B	1,150	23	24
C	1,000	3	8
D	600	7	6
E	1,000	20	18

The cost to sell for each product consists of a 10 percent sales commission.

Required:

1. Determine the carrying value of inventory at December 31, 2021, assuming the lower of cost or net realizable value (LCNRV) rule is applied to individual products.

2. Determine the carrying value of inventory at December 31, 2021, assuming the LCNRV rule is applied to the entire inventory.

3. Assuming inventory write-downs are common for Decker, record any necessary year-end adjusting entry based on the amount calculated in requirement 2.

business accounting

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Answer 1

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Answer #1

1) calculate following

Product	unit	Cost	NRV	Inventory value
A	1350	22950	29160	22950
B	1150	26450	24840	24840
C	1000	3000	7200	3000
D	600	4200	3240	3240
E	1000	20000	16200	16200
		76600	80640	70230

2) Inventory carrying value = $70230

3) Adjustment entry

Date	account and explanation	Debit	Credit
	Cost of goods sold (76600-70230)	6370
	Merchandise inventory		6370

> Could you please show your work for this?

Kelsey Frazier Wed, Mar 9, 2022 10:16 PM

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Answer 2

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