(a1) Determine the proper balance in Allowance to Reduce Inventory to Market at May 31, 2020.Balance in the Allowance to Reduce Inventory to Market $(a2) For the fiscal year ended May 31, 2020, determine the amount of the gain or loss that would be recorded due to the change inAllowance to Reduce Inventory to Market.The amount of the gain (loss)eTextbook and MediaSave for Later$Attempts: 4 of 5 usedSubmit Answer View PoliciesShow Attempt HistoryCurrent Attempt in ProgressWhispering Home Improvement Company installs replacement siding, windows, and louvered glass doors for single-family homesand condominium complexes. The company is in the process of preparing its annual financial statements for the fiscal year endedMay 31, 2020. Jim Alcide, controller for Whispering, has gathered the following data concerning inventory.At May 31, 2020, the balance in Whispering's Raw Materials Inventory account was $428,400, and Allowance to Reduce Inventoryto Market had a credit balance of $26,750. Alcide summarized the relevant inventory cost and market data at May 31, 2020, in theschedule below.Alcide assigned Patricia Devereaux, an intern from a local college, the task of calculating the amount that should appear onWhispering's May 31, 2020, financial statements for inventory at lower-of-cost-or-market as applied to each item in inventory.Devereaux expressed concern over departing from the historical cost principle. Assume Garcia uses LIFO inventory costing.Aluminum sidingCedar shake sidingLouvered glass doorsThermal windowsTotalCost$73,50090,300117,600147,000ReplacementCost$65,62583,370130,200132,300$428,400 $411,495Sales Price$67,20098,700195,720162,540$524,160NetRealizableValue$58,80089,040176,715147,000$471,555NormalProfit$5,3557,77019,42516,170$48,720

The anticipated amount that the business will get when it sells the inventory is known as the…

(a1) Determine the proper balance in Allowance to Reduce Inventory to Market at May 31, 2020. Balance in the Allowance to Reduce Inventory to Market $ (a2) For the fiscal year ended May 31, 2020, determine the amount of the gain or loss that would be recorded due to the change in Allowance to Reduce Inventory to Market. The amount of the gain (loss) eTextbook and Media Save for Later $ Attempts: 4 of 5 used Submit Answer

(a1) Determine the proper balance in Allowance to Reduce Inventory to Market at May 31, 2020. Balance in the Allowance to Reduce Inventory to Market $ (a2) For the fiscal year ended May 31, 2020, determine the amount of the gain or loss that would be recorded due to the change in Allowance to Reduce Inventory to Market. The amount of the gain (loss) eTextbook and Media Save for Later $ Attempts: 4 of 5 used Submit Answer

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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