The December 31, 2020 inventory of Abken Pottery Company consisted of four products, for which

certain information is provided below.

Replacement Estimated Expected Normal Profit

Product Original Cost Cost Disposal Cost Selling Price on Sales

A $25.00 $22.00 $6.50 $40.00 20%

B $42.00 $40.00 $12.00 $48.00 25%

C $120.00 $115.00 $25.00 $190.00 30%

D $18.00 $15.80 $3.00 $26.00 10%

Instruction:

Using the lower-of-cost-or-market approach applied on an individual-item basis, compute the

inventory valuation that should be reported for each product on December31, 2020.

Designated Lower-of CostProduct Ceiling Floor Market Cost or-Market. (EXPLAIN AND CALCULATION)