Question
At December 31, 2020, Blossom Company has outstanding noncancelable purchase commitments for 38,400 gallons, at $ 3.60 per gallon, of raw material to be used
At December 31, 2020, Blossom Company has outstanding noncancelable purchase commitments for 38,400 gallons, at $ 3.60 per gallon, of raw material to be used in its manufacturing process. The company prices its raw material inventory at cost or market, whichever is lower.
Assuming that the market price as of December 31, 2020, is $ 3.24, record the journal entry. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter 0 for the amounts. Round answers to 0 decimal places, e.g. 6,225.)
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started