Exercise 4 out of 4 LCM (10 points)

ROnTop is Recording house which produces DVDs, Videos, CDs and Cassettes.

1. Fill out the given table for each of the given basis by applying the LCM (Lower of cost or market) method.

Merchandise	Historical Cost	Market Value	Individual Item	Inventory Category	Total Category
Visual
DVD's	4000	4300
Video's	2000	1900
1*Subtotal	6000	6200
Audio
CD's	1500	930
Cassettes	500	460
2*Subtotal	2000	1390
Totals	8000	7590

2. If the Materiality level is 100 $, make the required journal entry for inventory category base.

Date	Account		Debit	Credit