Problem 6-5A Lower of cost or market LO P2

A physical inventory of Liverpool Company taken at December 31 reveals the following.

		Per Unit
Item	Units	Cost			Market
Car audio equipment
Speakers	354	$	109		$	117
Stereos	269		130			120
Amplifiers	335		105			114
Subwoofers	213		71			61
Security equipment
Alarms	489		169			159
Locks	300		112			102
Cameras	221		331			341
Binocular equipment
Tripods	194		93			103
Stabilizers	179		114			124

Required: 1. Calculate the lower of cost or market for the inventory applied separately to each item. 2. If the market amount is less than the recorded cost of the inventory, then record the LCM adjustment to the Merchandise Inventory account.