Decker Company has five products in its inventory. Information about the December

31, 2011, inventory follows:

ProductQuantityUnit CostUnit Replace CostUnit Selling Price

A1,000$10$12$16

B800 15 1118

C600328

D200746

E600141213

The selling cost for each product consists of a 15 percent sales commission. The normal profit

percentage for each product is 40 percent of the selling price.

Required:

1.Determine the balance sheet inventory carrying value at December 31, 2011, assuming the

LCM rule is applied to individual products.

$28,030

2. Determine the balance sheet inventory carrying value at December 31, 2011, assuming the

LCM rule is applied to the entire inventory. Also, assuming that Decker recognizes an inventory

write-down as a separate income statement item, determine the amount of the loss.