Ames Trading Company has the following products in its ending inventory. Cost per Market per Unit Unit Product Mountain bikes. Skateboards Gliders Inventory Items Quantity 14 15 20 Mountain bikes Skateboards Gliders Compute lower of cost or market for inventory applied separately to each product. $ 630 340 870 Units $ 580 410 830 Per Unit Cost Market Cost Total Market LCM applied to each product

Before discussing the topic inventory valuation let’s discuss the meaning of inventory. In accounting, inventory is also known as stock. Inventory means all the finished goods, materials, merchandise that a business holds for the purpose of selling it in…