Yang Manufacturing sells a limited line of specially made products, using television advertising campaigns in large cities. At year-end, Yang has the following data for its inventory:

1. Compute the carrying value of the ending inventory using the lower of cost or market rule applied on an item-by-item basis.

2. Prepare the journal entry required to value the inventory at lower of cost or market.

Number of Units Historical Cost per Unit Market Value per Unit Item $24 Phone Stereo Electric shaver MP3 alarm clock Handheld game system $11 190 35 25 19 600 180 220 430 570 30 26 40