Vasquez Paper Company has provided you with the following information regarding its inventory of paper for June and July. Vasquez uses a perpetual inventory system.

Instructions

Calculate the cost, the net realizable value, and the amount to be reported on the balance sheet for Vasquez$$s inventory at $(1)$ June $30$ and $(2)$ July $31.$

Prepare any journal entries required to record the LCNRV of the paper inventory at $(1)$ June $30$ and $(2)$ July $31.$

Assume that during the month of August, the company did not purchase any additional paper inventory. Assume also that on August $31$ it had $5,000$ tonnes in inventory and the NRV per tonne was $$720.$ Is an adjusting entry required at August $31?$ Explain. If so$,$ prepare the adjusting entry.

What is Vasquez required to disclose in its notes to the financial statements with regard to LCNRV$?$

Why is it important to report inventory at LCNRV on the balance sheet?