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Sandals Company is preparing the annual financial statements dated December 31. Ending inventory information about the four major items stocked for regular sale follows: Product

Sandals Company is preparing the annual financial statements dated December 31. Ending inventory information about the four major items stocked for regular sale follows:

Product Line Quantity on Hand Unit Cost When Acquire(FIFO) Market Value at Year-End
Air Flow 25 $ 13 $ 15
Blister Buster 80 38 36
Coolonite 34 60 55
Dudesly 15 28 33

Required:
1.

Compute the amount that should be reported for the ending inventory using the LCM rule applied to each item.

Ending Inventory

2.

How will the write-down of inventory to lower of cost or market affect the companys expenses reported for the year ended December 31?

Cost of goods sold will be by

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