The Brabham Kite Company had the following FIFO costs and replacement costs of kites for its ending inventory.

Item # Number of Units Unit Cost Unit Replacement Cost a ae UR a ee hp al 804 100 $10 $l 603 150 12 10 331 320 8 5 928 70 20 22 Required: (1) Compute the value of the ending inventory under the lower-of-cost-ormarket method applied to individual items.

(2) How are the company’s financial statements affected by the application of the lower-of-cost-or-market method?

(3) Show how the ending inventory would be reported on the company’s balance sheet.

 TYK-1