Monty Co. follows the practice of valuing its inventory at the lower-of-cost-or-market. The following information...
70.2K
Verified Solution
Link Copied!
Question
Accounting
Monty Co. follows the practice of valuing its inventory at the lower-of-cost-or-market. The following information is available from the companys inventory records as of December 31, 2020.
Item
Quantity
Unit Cost
ReplacementCost/Unit
Estimated SellingPrice/Unit
Completion & DisposalCost/Unit
Normal ProfitMargin/Unit
A
1,700
$8.25
$9.24
$11.55
$1.65
$1.98
B
1,400
9.02
8.69
10.34
0.99
1.32
C
1,600
6.16
5.94
7.92
1.27
0.66
D
1,600
4.18
4.62
6.93
0.88
1.65
E
2,000
7.04
6.93
7.37
0.77
1.10
Greg Forda is an accounting clerk in the accounting department of Monty Co., and he cannot understand why the market value keeps changing from replacement cost to net realizable value to something that he cannot even figure out. Greg is very confused, and he is the one who records inventory purchases and calculates ending inventory. You are the manager of the department and an accountant.
Calculate the lower-of-cost-or-market using the individual-item approach.
Lower-of-Cost-or-Market(Per unit basis)
Item A
$
Item B
$
Item C
$
Item D
$
Item E
$
Answer & Explanation
Solved by verified expert
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
