Computer manufacturer Hewlett-Packard's Web site provides information about Hewlett-Packard's 25,000 electronic products and services, its worldwide opera- tions, and its financial picture. Address: www.hp.com/ (or go to www.wiley.com/college/weygandt)

Steps:
1. Choose HP Financials.
2. Choose the current Annual Report.
3. Review the Summary of Significant Accounting Policies in the Notes to the Financial Statements.

Instructions

(a) At what cost does Hewlett-Packard report its inventories?

(b) What inventory costing method does standard cost approximate for Hewlett-Packard?

(c) Has the lower-of-cost-or-market rule been applied to the Hewlett-Packard inventories?

(d) Why do you suppose that Hewlett-Packard accounts for and reports its inventories at standard cost?