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Blossom Wig Shoppe carries a number of wigs that are made specifically for people who require them while undergoing medical treatment. They use a perpetual

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Blossom Wig Shoppe carries a number of wigs that are made specifically for people who require them while undergoing medical treatment. They use a perpetual inventory system and the FIFO cost formula for valuing inventory. The following information is available regarding the inventory on hand at year end, December 31. Unit Net Realizable Value Units Unit Cost Types: Marilyn 12 $130 $127 Farrah 10 200 210 Jane 7 50 75 J-LO 6 181 197 Cpt. Kirk 9 145 103 Assuming Blossom values each type of wig separately, determine the lower of cost and net realizable value of the ending inventory Lower of cost and net realizable value Prepare the journal entry required, if any, to record the adjustment at year end. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter o for the amounts.) Date Account Titles and Explanation Debit Credit Dec-31 (To record the decline in inventory value) Now assume Blossom combines all wigs together for the purposes of determining LCNRV. What amount should be reported on Blossom's balance sheet at year end? Value of inventory $ Assume Blossom made the required journal entry at year end based on the LCNRV as determined in part (a). Shortly after year end, as the economy recovered, it was determined that the NRV of this inventory had increased by $574. Prepare the journal entry required, if any, to record this recovery. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter o for the amounts.) Date Account Titles and Explanation Debit Credit Jan-31 (To record the recovery in inventory value.)

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