ower of Cost or Net Realizable Value

The accountant for Davidson, Inc. prepared the following analysis of its inventory at year end:

Item	Units	Cost per Unit		Net Realizable Value
	500	$38		$44
LKW-91247	329	49		45
QEC-57429	462	25		33

Required:

Question Content Area

1. Compute the carrying value of the ending inventory using the lower of cost or net realizable value rule applied on an item-by-item basis.

2. Prepare the journal entry required to value the inventory at lower of cost or net realizable value. If an amount box does not require an entry, leave it blank.