Problem 9-5 Fiedler Co. follows the practice of valuing its inventory at the lower-of-cost-or-market. The following information is available from the company's inventory records as of December 31, 2017. Estimated Price/Unit $10.50 9.40 7.20 6.30 6.70 Completion & Disposal Cost/Unit Normal Profit Selling Unit Cost Replacement Cost/Unit Item Quantity 1,100 800 1,000 1,000 1,400 Margin/Unit $8.40 7.90 5.40 4.20 6.30 $1.80 1.20 0.60 1.50 1.00 $7.50 8.20 5.60 3.80 6.40 $1.50 0.90 1.15 0.80 0.70 Greg Forda is an accounting clerk in the accounting department of Fiedler Co., and he cannot understand why the market value keeps changing from replacement cost to net realizable value to something that he cannot even figure out. Greg is very confused, and he is the one who records inventory purchases and calculates ending inventory. You are the manager of the department and an Your answer is partially correct. Try again Calculate the lower-of-cost-or-market using the individual-item approach Lower-of-Cost-or-Market (Per unit basis) Item A 7.50 Item B 7.90 Item C Item D 3.80 Item E 6.00 Your answer is partially correct. Try again. Show the journal entry he will need to make in order to write down the ending inventory from cost to market. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts Account Titles and Explanation Credit Debit t of Goods sold Me Cost of Goods Sold 1100 The Loss method: Loss Due to Market Decline of Inventory 1100 Inventory Click if you would like to Show Work for this question: Open Show Work Problem 9-5 Fiedler Co. follows the practice of valuing its inventory at the lower-of-cost-or-market. The following information is available from the company's inventory records as of December 31, 2017. Estimated Price/Unit $10.50 9.40 7.20 6.30 6.70 Completion & Disposal Cost/Unit Normal Profit Selling Unit Cost Replacement Cost/Unit Item Quantity 1,100 800 1,000 1,000 1,400 Margin/Unit $8.40 7.90 5.40 4.20 6.30 $1.80 1.20 0.60 1.50 1.00 $7.50 8.20 5.60 3.80 6.40 $1.50 0.90 1.15 0.80 0.70 Greg Forda is an accounting clerk in the accounting department of Fiedler Co., and he cannot understand why the market value keeps changing from replacement cost to net realizable value to something that he cannot even figure out. Greg is very confused, and he is the one who records inventory purchases and calculates ending inventory. You are the manager of the department and an Your answer is partially correct. Try again Calculate the lower-of-cost-or-market using the individual-item approach Lower-of-Cost-or-Market (Per unit basis) Item A 7.50 Item B 7.90 Item C Item D 3.80 Item E 6.00 Your answer is partially correct. Try again. Show the journal entry he will need to make in order to write down the ending inventory from cost to market. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts Account Titles and Explanation Credit Debit t of Goods sold Me Cost of Goods Sold 1100 The Loss method: Loss Due to Market Decline of Inventory 1100 Inventory Click if you would like to Show Work for this question: Open Show Work
