Lower-of-cost-or-market inventory OBJ. 6 Data on the physical inventory of Katus Products Co. as of December 31, 2016, follows:

Market Value per Unit (Net Description Realizable Value)

Inventory Quantity A54 37 $ 56 C77 24 178 F66 30 132 H83 21 545 K12 375 5 Q58 90 18 S36 8 235 V97 140 20 Y88 17 744 Quantity and cost data from the last purchases invoice of the year and the next-to-the-last purchases invoice are summarized as follows:

Last Purchases Invoice Next-to-the-Last Purchases Invoice Description Quantity Purchased Unit Cost Quantity Purchased Unit Cost A54 30 $ 60 40 $ 58 C77 25 174 15 180 F66 20 130 15 128 H83 6 547 15 540 K12 500 6 500 7 Q58 75 25 80 26 S36 5 256 4 260 V97 100 17 115 16 Y88 10 750 8 740 Instructions Determine the inventory at cost and also at the lower of cost or market, using the first-in, first-out method. Record the appropriate unit costs on the inventory sheet, and complete the pricing of the inventory. When there are two different unit costs applicable to an item:

1. Draw a line through the quantity, and insert the quantity and unit cost of the last purchase.

2. On the following line, insert the quantity and unit cost of the next-to-the-last purchase.

3. Total the cost and market columns and insert the lower of the two totals in the Lower of C or M column. The first item on the inventory sheet has been completed as an example.

Inventory Sheet December 31, 2016 Description Unit Inventory Quantity Cost per Unit Market Value per Unit (Net Realizable Value)

Total Cost Market LCM A54 37 30 60 $56 $1,800 $1,680 7 58 56 406 392

$2,206 $2,072 $2,072 Appendix