Inventory Write-Down Stiles Corporation uses the FIFO cost flow assumption and is in the process of...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Inventory Write-Down Stiles Corporation uses the FIFO cost flow assumption and is in the process of applying the LCNRV rule for each of two products in its ending inventory. A profit margin of 30% on the selling price is considered normal for each product. Specific data for each product are as follows: Product A Product B Historical cost $ 80 $96 Replacement cost Estimated cost of disposal Estimated selling price 70 98 32 30 150 120 Inventory Write-Down Use the information in Es-1. Assume that Stiles uses the LIFO cost flow assumption and is applying the LCM rule. Required: 1. What is the correct inventory value for each product? 2. Next Level With regard to requirement 1, what effect does the imposition of the constraints on market value have on the inventory valuations? Inventory Write-Down Stiles Corporation uses the FIFO cost flow assumption and is in the process of applying the LCNRV rule for each of two products in its ending inventory. A profit margin of 30% on the selling price is considered normal for each product. Specific data for each product are as follows: Product A Product B Historical cost $ 80 $96 Replacement cost Estimated cost of disposal Estimated selling price 70 98 32 30 150 120 Inventory Write-Down Use the information in Es-1. Assume that Stiles uses the LIFO cost flow assumption and is applying the LCM rule. Required: 1. What is the correct inventory value for each product? 2. Next Level With regard to requirement 1, what effect does the imposition of the constraints on market value have on the inventory valuations?
Expert Answer:
Answer rating: 100% (QA)
Product A NRV less profit margin Selling price Cost of dispos... View the full answer
Related Book For
Intermediate Accounting Reporting and Analysis
ISBN: 978-1337788281
3rd edition
Authors: James M. Wahlen, Jefferson P. Jones, Donald Pagach
Posted Date:
Students also viewed these accounting questions
-
Stiles Corporation uses the FIFO cost flow assumption and is in the process of applying the LCNRV rule for each of two products in its ending inventory . A profit margin of 30% on the selling price...
-
A manufacturing business is in the process of applying for property insurance. What kind of information must the business disclose to the insurance company? Why can insurance companies deny coverage...
-
The nick lumber company is in the process of deciding whether to sell or process further rough sawn lumber, the joint cost of producing the rough sawn lumber is $10,500, the following data is...
-
Since the introduction of enhanced security measures by the U.S. Department of Homeland Security in 2017, flights bound for the U.S. from Canada are subject to additional screening by airline...
-
Derive the equations of the deflection curve for beam AB, with guided support at A and roller support at B, supporting a distributed load of maximum intensity q0 acting on the right-hand half of the...
-
Whitewater Adventures manufactures two models of kayaks, Basic and Deluxe, using a combination of machining and hand finishing. Machine setup costs are driven by the number of setups. Indirect...
-
What elements must be proven in order to be successful in a negligence suit? Illustrate your answer with a case (the facts of the case can be hypothetical).
-
Discuss the accuracy of this statement: Formal strategic planning systems are irrelevant for firms competing in high- technology industries where the pace of change is so rapid that plans are...
-
The capital accounts of Hassan Khan and Dmitri Palovich have balances of $110,000 and $78,000, respectively, on January 1, 2014, the beginning of the fiscal year. On July 10, Khan invested an...
-
The file P02_07.xlsx includes data on 204 employees at the (fictional) company Beta Technologies. a. Run a forward stepwise regression of Annual Salary versus Gender, Age, Prior Experience, Beta...
-
A textile mill completes their production in four process, spinning, dyeing, weaving and finishing. Direct materials are added last, then conversion costs are added incrementally throughout. The...
-
Case #5. The NP knows that before referring a patient with urinary incontinence to a urologist for cystoscopy or urodynamic testing that they should rule out the transient causes of incontinence that...
-
With a $5 million dollar portfolio. The first year you earn a 25% capital gain and earn $250,000 income at year-end. You spend $200,000 and reinvest the rest. The second year your capital gain is...
-
A seamstress plans to make scarves, which would require renting a new machine at a cost of $1,000 per month. The variable costs would be $20 per scarf and the selling price would be $40 per scarf. If...
-
Case #4. A 75-year-old woman comes to see her PCP for routine health care and notes that she has had increasing urinary frequency with occasional small amounts of urinary incontinence. She uses a...
-
a) Please provide two examples in which a company makes decisions that have dimension of social responsibility. (2 marks) b) Please provide two examples of international index/ratings to measure...
-
Modify the following program to demonstrate the following: 1: prompts the user for total number of hours and minutes elapsed\ 2: displays total time elapsed in number of seconds # Activity 1.7 # Get...
-
Figure displays a 12.0 V battery 3 four uncharged capacitors of capacitances C1 = 4.00F, C2 = 6.00F, and C3 = 3.00F. The switch is thrown to the left side until capacitor 1 is fully charged. Then the...
-
On June 1, 2019, Hansen Company purchased ten $1,000 Francisco Company bonds at par and classified them as held-to-maturity. In 2020, Francisco experienced financial difficulties and on Dec 31, 2020,...
-
Mauldin Company makes sales on which a 5% sales tax is assessed. The following summary transactions were made during 2019: 1. sales for cash of $1,665,400, excluding sales taxes 2. sales on credit of...
-
Company enters into a contract with Dearborn Inc. to sell it $50,000 of goods with delivery on May 10, 2019. Cass manufactured the goods at a cost of $33,000. The contract is signed on April 15,...
-
Describe which characteristics of HR metrics and workforce analytics are likely to result in greater return on investment and organizational impact.
-
Why are information security and privacy important considerations in the design, development, and maintenance of an HRIS?
-
List and discuss the major information security and privacy threats to organizations.
Study smarter with the SolutionInn App