Question
The Ikida Company normally sells its inventory at a 20% profit margin on sales. In 2006, the net realizable value of inventory purchased for $50,000
The Ikida Company normally sells its inventory at a 20% profit margin on sales. In 2006, the net realizable value of inventory purchased for $50,000 declined to $48,000. There are no costs to complete and dispose of this inventory. What is the floor constraint on the valuation of this inventory, using the lower of cost or market rule?
| a. | $48,000 |
| b. | $38,400 |
| c. | $50,000 |
| d. | $40,000 |
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Food And Beverage Cost Control
Authors: Lea R. Dopson, David K. Hayes
6th Edition
1118988493, 978-1118988497
