Presented below is data relative to the 12/31/23 inventory of Traynor Trailer Company: Number Units Original Cost Total Current Item In Inventory Per Unit Original Cost Replacement Cost A 1,000 $1.09 $1,090 $1.08 1,000 1.30 1,300 1.15 C 1,000 1.50 1,500 1.05 D 1,000 1.60 1,600 1.65 1,000 1.80 1,800 1.90 Total 5.000 $7,290 Additional Data: Selling price is $2.00/unit for all items. Disposal costs amount to 15% of s and a "normal" profit is 30% of selling price. Traynor uses the LIFO method of inventory valu REQUIRED: a. Determine the write-down to market required. Use the Individual Inventory Approach to LCM Valuation. (You are not required to record the adjusting entr b. Repeat Part (a) assuming that Traynor uses the FIFO method.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Presented below is data relative to the 12/31/23 inventory of Traynor Trailer Company:
Number Units
Original Cost
Total
Current
Item
In Inventory
Per Unit
Original Cost
Replacement Cost
1,000
$1.09
$1,090
$1.08
1,000
1.30
1,300
1.15
C
1,000
1.50
1,500
1.05
D
1,000
1.60
1,600
1.65
E
1,000
1.80
1,800
1.90
Total
5.000
$7.290
Additional Data: Selling price is $2.00/unit for all items. Disposal costs amount to 15% of selling price
and a "normal" profit is 30% of selling price. Traynor uses the LIFO method of inventory valuation.
REQUIRED:
a. Determine the write-down to market required. Use the Individual Inventory Items
Approach to LCM Valuation. (You are not required to record the adjusting entry).
b. Repeat Part (a) assuming that Traynor uses the FIFO method.
Transcribed Image Text:Presented below is data relative to the 12/31/23 inventory of Traynor Trailer Company: Number Units Original Cost Total Current Item In Inventory Per Unit Original Cost Replacement Cost 1,000 $1.09 $1,090 $1.08 1,000 1.30 1,300 1.15 C 1,000 1.50 1,500 1.05 D 1,000 1.60 1,600 1.65 E 1,000 1.80 1,800 1.90 Total 5.000 $7.290 Additional Data: Selling price is $2.00/unit for all items. Disposal costs amount to 15% of selling price and a "normal" profit is 30% of selling price. Traynor uses the LIFO method of inventory valuation. REQUIRED: a. Determine the write-down to market required. Use the Individual Inventory Items Approach to LCM Valuation. (You are not required to record the adjusting entry). b. Repeat Part (a) assuming that Traynor uses the FIFO method.
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