Q7. In some instances, accounting principles require a departure from valuing inventories at cost alone. Determine the proper unit inventory value in the following cases, under the lower-of-cost-or-market rule. Cases 1 2 3 4 5 Cost $15.90 $16.10 $15.90 $15.90 $15.90 Net realizable value 14.50 19.20 15.20 10.40 16.40 Net realizable value less normal profit 12.80 17.60 13.75 8.80 14.80 Market (replacement cost) 14.80 17.20 12.80 9.70 16.80 BE9-4. (LO 2) Presented below is information related to Rembrandt Inc.'s inventory, assuming Rembrandt uses lower-of-LIFO cost-or-market. (per unit) Skis Boots Parkas Historical cost $190.00 $106.00 $53.00 Selling price 212.00 145.00 73.75 Cost to distribute 19.00 8.00 2.50 Current replacement cost 203.00 105.00 51.00 Normal profit margin 32.00 29.00 21.25 Determine the following: (a) the two limits to market value (i.e., the ceiling and the floor) that should be used in the lower-of-cost-or-market computation (b) the cost amount that should be used in the lower- of-cost-or-market comparison, and (c) the market amount that should be used to value the items on the basis of the lower-of-cost-or-market (designated market). Q7. In some instances, accounting principles require a departure from valuing inventories at cost alone. Determine the proper unit inventory value in the following cases, under the lower-of-cost-or-market rule. Cases 1 2 3 4 5 Cost $15.90 $16.10 $15.90 $15.90 $15.90 Net realizable value 14.50 19.20 15.20 10.40 16.40 Net realizable value less normal profit 12.80 17.60 13.75 8.80 14.80 Market (replacement cost) 14.80 17.20 12.80 9.70 16.80 BE9-4. (LO 2) Presented below is information related to Rembrandt Inc.'s inventory, assuming Rembrandt uses lower-of-LIFO cost-or-market. (per unit) Skis Boots Parkas Historical cost $190.00 $106.00 $53.00 Selling price 212.00 145.00 73.75 Cost to distribute 19.00 8.00 2.50 Current replacement cost 203.00 105.00 51.00 Normal profit margin 32.00 29.00 21.25 Determine the following: (a) the two limits to market value (i.e., the ceiling and the floor) that should be used in the lower-of-cost-or-market computation (b) the cost amount that should be used in the lower- of-cost-or-market comparison, and (c) the market amount that should be used to value the items on the basis of the lower-of-cost-or-market (designated market)