[This is a variation of E 9-2, modified to focus on the lower of cost or market.]

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[This is a variation of E 9-2, modified to focus on the lower of cost or market.] The inventory of Royal Decking consisted of five products. Information about the December 31, 2021, inventory is as follows:

Per Unit Product Replacement Cost Cost Selling Price $ 40 $ 60 $35 A в 80 40 70 100 55 80 130 D 100 70 20 28 30

Selling costs consist of a sales commission equal to 10% of selling price and shipping costs equal to 5% of cost. The normal profit is 30% of selling price.


Required:
What unit value should Royal Decking use for each of its products when applying the lower of cost or market (LCM) rule to units of ending inventory?


E 9-2

Ending Inventory
The ending inventory is the amount of inventory that a business is required to present on its balance sheet. It can be calculated using the ending inventory formula                Ending Inventory Formula =...
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Intermediate Accounting

ISBN: 978-1260481952

10th edition

Authors: J. David Spiceland, James Sepe, Mark Nelson, Wayne Thomas

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