Al Aznar Company is manufacturer of furniture. At the end of 2018, they have inventory worth $ 14500 and out of that $ 4500 worth inventory is damaged. The company decided to repair the inventory and sell it for 3500. The repair cost is $ 500. 1. When do a company write down its inventory value (cost) to the Net Realizable Value? 2. Imagine that the company decided to sell the damaged inventory for $ 3200 without spending any amount for repairing, how much amount need to write off from the value of inventory at the end of the period?

Al Aznar Company is manufacturer of furniture. At the end of 2018, they have inventory worth $ 14500 and out of that $ 4500 worth inventory is damaged. The company decided to repair the inventory and sell it for 3500. The repair cost is $ 500. 1. When do a company write down its inventory value (cost) to the Net Realizable Value? 2. Imagine that the company decided to sell the damaged inventory for $ 3200 without spending any amount for repairing, how much amount need to write off from the value of inventory at the end of the period?

SWFT Comprehensive Vol 2020

43rd Edition

ISBN:9780357391723

Author:Maloney

Publisher:Maloney

Chapter14: Property Transact Ions: Capital Gains And Losses, § 1231, And Recapture Provisions

Section: Chapter Questions

Problem 17DQ

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