Due to a nationwide recession, Liquidation Universes merchandise inventory is gathering dust It is now October 31, 2012, and the $163,300 that Liquidation Universe paid for its ending inventory is $15,900 higher than current replacement cost Before any adjustments at the end of the period, Liquidat...

Req 1 Liquidation Universe should report inventory at the current replacem ...

Due to a nationwide recession, Liquidation Universes merchandise inventory is gathering dust. It is now October 31,

Question:

Due to a nationwide recession, Universe’s merchandise inventory is gathering dust. It is now October 31, 2012, and the $163,300 that Universe paid for its is $15,900 higher than current replacement cost. Before any adjustments at the end of the period, Universe’s Cost of Goods Sold account has a balance of $614,000. Universe uses lower of cost or market to value its .

Requirements
1. What amount should Universe report for inventory on the balance sheet?
2. What amount should Universe report for cost of goods sold?
3. Journalize any required entries.

Ending Inventory
The ending inventory is the amount of inventory that a business is required to present on its balance sheet. It can be calculated using the ending inventory formula Ending Inventory Formula =... Liquidation
Liquidation in finance and economics is the process of bringing a business to an end and distributing its assets to claimants. It is an event that usually occurs when a company is insolvent, meaning it cannot pay its obligations when they are due....