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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
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 | $ | 5.20 | $ | 5.70 | ||||||
Saws | 220 | 10.20 | 9.20 | ||||||||
Screwdrivers | 320 | 2.20 | 2.80 | ||||||||
Paint products: | |||||||||||
1-gallon cans | 520 | 6.20 | 5.20 | ||||||||
Paint brushes | 120 | 4.20 | 4.70 | ||||||||
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. 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.
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