Lower of Cost and Net Realizable Value Meredith's Appliance Store has the following data for the items in its inventory at the end of the accounting period: Item Number of Units Historical Cost per Unit Net Realizable Value per Unit Window air conditioner 18 $194 $110 Dishwasher 30 240 380 Refrigerator 27 415 405 Microwave 19 215 180 Washer (clothing) 32 195 248 Dryer (clothing) 21 197 245 Required: 1. Compute the carrying value of Meredith's ending inventory using the lower of cost and net realizable value (LCNRV) rule applied on an item-by-item basis. 2. Prepare the journal entry required to value the inventory at LCNRV.
Lower of Cost and Net Realizable Value Meredith's Appliance Store has the following data for the items in its inventory at the end of the accounting period: Item Number of Units Historical Cost per Unit Net Realizable Value per Unit Window air conditioner 18 $194 $110 Dishwasher 30 240 380 Refrigerator 27 415 405 Microwave 19 215 180 Washer (clothing) 32 195 248 Dryer (clothing) 21 197 245 Required: 1. Compute the carrying value of Meredith's ending inventory using the lower of cost and net realizable value (LCNRV) rule applied on an item-by-item basis. 2. Prepare the journal entry required to value the inventory at LCNRV.
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter6: Cost Of Goods Sold And Inventory
Section: Chapter Questions
Problem 24CE: Inventory Costing: Average Cost Refer to the information for Filimonov Inc. and assume that the...
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Lower of Cost and Net Realizable Value
Meredith's Appliance Store has the following data for the items in its inventory at the end of the accounting period:
Item | Number of Units | Historical Cost per Unit | Net Realizable Value per Unit | |||
Window air conditioner | 18 | $194 | $110 | |||
Dishwasher | 30 | 240 | 380 | |||
Refrigerator | 27 | 415 | 405 | |||
Microwave | 19 | 215 | 180 | |||
Washer (clothing) | 32 | 195 | 248 | |||
Dryer (clothing) | 21 | 197 | 245 |
Required:
1. Compute the carrying value of Meredith's ending inventory using the lower of cost and net realizable value (LCNRV) rule applied on an item-by-item basis.
2. Prepare the
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