1. Given the historical cost of product Z is $30, the selling price of product Z is $35, costs to sell product Z are $3, the replacement cost for product Z is $31, and the normal profit margin is 40% of sales price, what is the amount that should be used to value the inventory under the lower-of-cost-or-market method?

2. Sandhill Corporation acquired two inventory items at a lump-sum cost of $116000. The acquisition included 2880 units of product LF, and 5760 units of product 1B. LF normally sells for $30 per unit, and 1B for $10 per unit. If Sandhill sells 960 units of LF, what amount of gross profit should it recognize?

3. Confectioners, a chain of candy stores, purchases its candy in bulk from its suppliers. For a recent shipment, the company paid $2700 and received 7500 pieces of candy that are allocated among three groups. Group 1 consists of 2230 pieces that are expected to sell for $0.15 each. Group 2 consists of 4960 pieces that are expected to sell for $0.31 each. Group 3 consists of 310 pieces that are expected to sell for $0.67each. Using the relative sales value method, what is the cost per item in Group 1?

4. During 2017, Sandhill Co., a manufacturer of chocolate candies, contracted to purchase 258000 pounds of cocoa beans at $4.80 per pound, delivery to be made in the spring of 2018. Because a record harvest is predicted for 2018, the price per pound for cocoa beans had fallen to $3.70 by December 31, 2017. Of the following journal entries, the one which would properly reflect in 2017 the effect of the commitment of Sandhill Co. to purchase the 258000 pounds of cocoa is

5. Sunland Corporation, a manufacturer of ethnic foods, contracted in 2017 to purchase 660 pounds of a spice mixture at $3.30 per pound, delivery to be made in spring of 2018. By 12/31/17, the price per pound of the spice mixture had risen to $3.49 per pound. In 2017, Sunland should recognize

6. Carla Vista Distribution Co. has determined its December 31, 2017 inventory on a LIFO basis at $1043000. Information pertaining to that inventory follows:

Estimated selling price	$1090000
Estimated cost of disposal	47000
Normal profit margin	127000
Current replacement cost	963000

Carla Vista records losses that result from applying the lower-of-cost-or-market rule. At December 31, 2017, the loss that Carla Vista should recognize is