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Home Stop sells two product categories, furniture and accessories. Information pertaining to its year-end inventory is as follows: Inventory, by Product Category Quantity Per Unit
Home Stop sells two product categories, furniture and accessories. Information pertaining to its year-end inventory is as follows:
Inventory, by Product Category | Quantity | Per Unit Cost | Market |
---|---|---|---|
Furniture: | |||
Chairs | 50 | $ 26 | $ 32 |
Desks | 20 | 74 | 59 |
Tables | 70 | 85 | 93 |
Accessories: | |||
Rugs | 50 | 61 | 49 |
Lamps | 30 | 23 | 19 |
Required:
Determine the carrying value of inventory at year-end, assuming the lower of cost or market (LCM) rule is applied to (a) individual products, (b) product categories, and (c) total inventory.
Assuming inventory write-downs are common for Home Stop, record any necessary year-end adjusting entry for each of the LCM applications in requirement 1.
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