FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Sunland Company sells product 2005WSC for $125 per unit. The cost of one unit of 2005WSC is $122, and the replacement cost is $121. The estimated cost to dispose of a unit is $6, and the normal profit is 40% of selling price. At what amount per unit should product 2005WSC be reported, applying lower-of-cost-or-market?
$121.
$122.
$69.
$119.
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Step 1 Introduction
The lower-of-cost-or-market rule defines that inventory should be recorded in books at lower cost among current market value and actual cost value.
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