Exercise 6-14 (Algo) Calculate inventory using lower of cost and net realizable value (LO6-6)

A company like Golf USA that sells golf-related inventory typically will have inventory items such as golf clothing and golf equipment. As technology advances the design and performance of the next generation of drivers, the older models become less marketable and therefore decline in value. Suppose that in the current year, Ping (a manufacturer of golf clubs) introduces the MegaDriver II, the new and improved version of the MegaDriver. Below are year-end amounts related to Golf USAs inventory.

Required information Exercise 6-14 (Algo) Calculate inventory using lower of cost and net realizable value (LO6-6) [The following information applies to the questions displayed below.] A company like Golf USA that sells golf-related inventory typically will have inventory items such as golf clothing and golf equipment. As technology advances the design and performance of the next generation of drivers, the older models become less marketable and therefore decline in value. Suppose that in the current year, Ping (a manufacturer of golf clubs) introduces the MegaDriver II, the new and improved version of the MegaDriver. Below are year-end amounts related to Golf USA's inventory. Unit NRV Inventory Shirts Quantity 27 Unit Cost $50 $62 MegaDriver 21 280 200 MegaDriver II 22 310 340 Exercise 6-14 (Algo) Part 1 Required: 1. Calculate the total recorded cost of ending inventory before any adjustments. Cost of ending inventory (before adjustment) 14,050 Required information Exercise 6-14 (Algo) Calculate inventory using lower of cost and net realizable value (LO6-6) [The following information applies to the questions displayed below.] A company like Golf USA that sells golf-related inventory typically will have inventory items such as golf clothing and golf equipment. As technology advances the design and performance of the next generation of drivers, the older models become less marketable and therefore decline in value. Suppose that in the current year, Ping (a manufacturer of golf clubs) introduces the MegaDriver II, the new and improved version of the MegaDriver. Below are year-end amounts related to Golf USA's inventory. Unit NRV Inventory Shirts Quantity 27 Unit Cost $50 $62 MegaDriver 21 280 200 MegaDriver II 22 310 340 Exercise 6-14 (Algo) Part 2 2. Calculate ending inventory using the lower of cost and net realizable value. Inventory Quantity Lower of Cost and NRV per unit Ending Inventory $ 50 200 310 Shirts MegaDriver MegaDriver II 27 21 22 $ $ 1,350 4,200 6,820 12,370 Required information Exercise 6-14 (Algo) Calculate inventory using lower of cost and net realizable value (LO6-6) [The following information applies to the questions displayed below.] A company like Golf USA that sells golf-related inventory typically will have inventory items such as golf clothing and golf equipment. As technology advances the design and performance of the next generation of drivers, the older models become less marketable and therefore decline in value. Suppose that in the current year, Ping (a manufacturer of golf clubs) introduces the MegaDriver II, the new and improved version of the MegaDriver. Below are year-end amounts related to Golf USA's inventory. Unit NRV Inventory Shirts Quantity 27 Unit Cost $50 $62 MegaDriver 21 280 200 MegaDriver II 22 310 340 Exercise 6-14 (Algo) Part 3 3. Record any necessary adjusting entry to inventory. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) View transaction list View journal entry worksheet Transaction General Journal Debit Credit No 1 1 Cost of Goods Sold Inventory 1,680 1,680 Required information Exercise 6-14 (Algo) Calculate inventory using lower of cost and net realizable value (LO6-6) [The following information applies to the questions displayed below.] A company like Golf USA that sells golf-related inventory typically will have inventory items such as golf clothing and golf equipment. As technology advances the design and performance of the next generation of drivers, the older models become less marketable and therefore decline in value. Suppose that in the current year, Ping (a manufacturer of golf clubs) introduces the MegaDriver II, the new and improved version of the MegaDriver. Below are year-end amounts related to Golf USA's inventory. Unit NRV Inventory Shirts Quantity 27 Unit Cost $50 $62 MegaDriver 21 280 200 MegaDriver II 22 310 340 Exercise 6-14 (Algo) Part 4 4. Determine the impact of the adjusting entry in the financial statements. (Amounts to be deducted should be entered with minus sign.) Income Statement: Revenues Expenses = Net Income Balance Sheet: Assets Liabilities Stockholders' Equity