The controller of Cox Company is applying the Lower of Cost and Net Realizable Value...
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Accounting
The controller of Cox Company is applying the Lower of Cost and Net Realizable Value to its ending inventory. The following information is available:
Cost NRV
Lawnmowers:
Self-propelled $14,800 $17,000
Push type 19,000 18,000
Total 33,800 35,000
Snowblowers:
Manual 29,800 31,000
Self-start 19,000 21,000
Total 48,800 52,000
Total inventory $82,600 $87,000
A) Compute the value of the ending inventory by applying the Lower of Cost and Net Realizable Value.
| LCNRV Applies | ||||||
| Description | Category | Cost | NRV | Individual | Category | Total |
| Self-propelled | Lawnmowers |
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| Push type | Lawnmowers |
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| Total Lawnmowers |
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| Manual | Snowblower |
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| Self-start | Snowblower |
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| Total Snowblowers |
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| Total |
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B) Prepare the adjusting entry, if required, if LCNRV was applied using individual products
| General Journal G1 | ||||
| Date | Account Title and Explanation | Ref. | Debit | Credit |
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