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4/1/2016 Day 21: Chapter 9.1 HW AC310 Financial Reporting: Spring 2016: Section 003 (3:30 - 4:45 pm) Section 320 (5:00 - 6:15 pm) MW Day 21: Chapter 9.1 HW 2. Mark Powers instructions | help value: 10.00 points Almaden Hardware Store sells two distinct types of products, tools and paint products. Information pertaining to its 2016 yearend inventory is as follows: Inventory, by Product Type Tools: Hammers Saws Screwdrivers Paint products: 1gallon cans Paint brushes Per Unit Quantity Cost 100 $ 5.00 200 10.00 300 2.00 500 6.00 100 4.00 Net Realizable Value $5.50 9.00 2.60 5.00 4.50 Required: 1. Determine the book value of inventory at yearend, assuming the lower of cost and net realizable value rule is applied to (a) individual products, (b) product type, and (c) total inventory. Lower of cost and NRV Product Net Realizable Value Cost By Individual Products By Product Type By Total Inventory Tools: Hammers Saws Screwdrivers Total tools 0 0 0 0 0 $ 0 $ Paint products: 1gallon cans Paint brushes Total paint Total $ 0 $ 0 2. Assuming that the company reports an inventory writedown as a line item in the income statement, for each of the lower of cost and net realizable value applications determine the amount of the loss. (a) Individual products (b) Product type (c) Total inventory References http://ezto.mheducation.com/hm.tpx eBook & Resources 1/2 4/1/2016 Day 21: Chapter 9.1 HW Worksheet Difficulty: 2 Medium Learning Objective: 0901 Understand and apply the lower of cost and net realizable value rule used to value inventories. Check my work 2016 McGraw-Hill Education. All rights reserved. http://ezto.mheducation.com/hm.tpx 2/2