Question
On the basis of the following data, determine the value of the inventory at the lower of cost or market. Assemble the data in the
On the basis of the following data, determine the value of the inventory at the lower of cost or market. Assemble the data in the form illustrated in Exhibit 10.
| Product | Inventory Quantity | Cost Per Unit | Market Value per Unit (Net Realizable Value) |
|---|---|---|---|
| Class 1: | |||
| Model A | 18 | $157 | $160 |
| Model B | 20 | 231 | 234 |
| Model C | 42 | 287 | 309 |
| Class 2: | |||
| Model D | 27 | 156 | 177 |
| Model E | 26 | 90 | 114 |
Question Content Area
a. Determine the value of the inventory at the lower of cost or market applied to each item in the inventory.
| Product | Inventory Quantity | Cost per Unit | Market Value per Unit (Net Realizable Value) | Cost | Market | Lower of Cost or Market |
|---|---|---|---|---|---|---|
| Model A | Model A | $Model A | $Model A | $Model A | $Model A | $Model A |
| Model B | Model B | Model B | Model B | Model B | Model B | Model B |
| Model C | Model C | Model C | Model C | Model C | Model C | Model C |
| Model D | Model D | Model D | Model D | Model D | Model D | Model D |
| Model E | Model E | Model E | Model E | Model E | Model E | Model E |
| Total | blank | blank | blank | $Total | $Total | $Total |
Question Content Area
b. Determine the value of the inventory at the lower of cost or market applied to each class of inventory.
| Product | Inventory Quantity | Cost per Unit | Market Value per Unit (Net Realizable Value) | Cost | Market | Lower of Cost or Market |
|---|---|---|---|---|---|---|
| Class 1: | blank | blank | blank | blank | blank | blank |
| Model A | Model A | $Model A | $Model A | $Model A | $Model A | blank |
| Model B | Model B | Model B | Model B | Model B | Model B | blank |
| Model C | Model C | Model C | Model C | Model C | Model C | blank |
| Subtotal | blank | blank | blank | $Subtotal | $Subtotal | $Subtotal |
| Class 2: | blank | blank | blank | blank | blank | blank |
| Model D | Model D | Model D | Model D | $Model D | $Model D | blank |
| Model E | Model E | Model E | Model E | Model E | Model E | blank |
| Subtotal | blank | blank | blank | $Subtotal | $Subtotal | Subtotal |
| Total | blank | blank | blank | $Total | $Total | $Total |
Question Content Area
c. Determine the value of the inventory at the lower of cost or market applied to total inventory.
| Product | Inventory Quantity | Cost per Unit | Market Value per Unit (Net Realizable Value) | Cost | Market | Lower of Cost or Market |
|---|---|---|---|---|---|---|
| Model A | Model A | $Model A | $Model A | $Model A | $Model A | blank |
| Model B | Model B | Model B | Model B | Model B | Model B | blank |
| Model C | Model C | Model C | Model C | Model C | Model C | blank |
| Model D | Model D | Model D | Model D | Model D | Model D | blank |
| Model E | Model E | Model E | Model E | Model E | Model E | blank |
| Total | blank | blank | blank | $Total | $Total | $Total |
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Cost Accounting Foundations and Evolutions
Authors: Michael R. Kinney, Cecily A. Raiborn
8th Edition
9781439044612, 1439044619, 978-1111626822
