Almaden Hardware Store sells two product categories, tools and paint products. Information pertaining to its 2021 year-end inventory is as follows: Inventory, by Product Category Quantity Per Unit Cost Net Realizable Value Tools: Hammers 120 $ 5.50 $ 6.00 Saws 250 10.50 9.50 Screwdrivers 350 2.50 3.10 Paint products: 1-gallon cans 550 6.50 5.50 Paint brushes 120 4.50 5.00

Required:

1. Determine the carrying value of inventory at year-end, assuming the lower of cost or net realizable value (LCNRV) rule is applied to (a) individual products, (b) product categories, and (c) total inventory.

		Net Realizable Value	By Individual Products	By Product Categories	By Total Inventory
Product	Cost
Tools:
Hammers
Saws
Screwdrivers
Total tools	$0	$0
Paint products:
1-gallon cans
Paint brushes
Total paint	$0	$0
Total	$0	$0	$0	$0

2. Assuming inventory write-downs are common for Almaden, record any necessary year-end adjustment amount for each of the LCNRV applications in requirement 1.

Journal entry worksheet

Record necessary year-end adjustment for individual products.

Transaction	General Journal	Debit	Credit
1

explanation

Journal entry worksheet

Record necessary year-end adjustment for product categories.

Transaction	General Journal	Debit	Credit
2

explanation

Journal entry worksheet

Record necessary year-end adjustment for total inventory.

Transaction	General Journal	Debit	Credit
3

explanation