A physical inventory of Liverpool Company taken at December 31 reveals the following. ...
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A physical inventory of Liverpool Company taken at December 31 reveals the following.
Item Units Per Unit Cost Market Car audio equipment Speakers 345 $ 100 $ 108 Stereos 260 121 110 Amplifiers 326 96 105 Subwoofers 204 62 51 Security equipment Alarms 480 160 135 Locks 291 103 94 Cameras 212 320 332 Binocular equipment Tripods 185 80 94 Stabilizers 170 107 115
Required: 1. Compute the lower of cost or market for the inventory applied separately to each item. 2. If the market amount is less than the recorded cost of the inventory, then record the LCM adjustment to the Merchandise Inventory account.
A physical inventory of Liverpool Company taken at December 31 reveals the following.
| Item | Units | Per Unit | |
|---|---|---|---|
| Cost | Market | ||
| Car audio equipment | |||
| Speakers | 345 | $ 100 | $ 108 |
| Stereos | 260 | 121 | 110 |
| Amplifiers | 326 | 96 | 105 |
| Subwoofers | 204 | 62 | 51 |
| Security equipment | |||
| Alarms | 480 | 160 | 135 |
| Locks | 291 | 103 | 94 |
| Cameras | 212 | 320 | 332 |
| Binocular equipment | |||
| Tripods | 185 | 80 | 94 |
| Stabilizers | 170 | 107 | 115 |
Required: 1. Compute the lower of cost or market for the inventory applied separately to each item. 2. If the market amount is less than the recorded cost of the inventory, then record the LCM adjustment to the Merchandise Inventory account.
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