Question: Mawasem Co. has 1,000 units of inventory with a cost of $30,000 and a net realizable value of $25,000. Assuming the allowance method of adjusting to lower-of-cost-or-net realizable value is used, and allowance to reduce inventory to NRV account has a credit balance in the amount of $300, Mawasem record the following entry:a. Dr. Cost of goods sold

Mawasem Co$.$ has $1,000$ units of inventory with a cost of $$30,000$ and a net realizable value of $$25,000.$ Assuming the allowance method of adjusting to lower$-$of$-$cost$-$or$-$net realizable value is used, and allowance to reduce inventory to NRV account has a credit balance in the amount of $$300,$ Mawasem record the following entry:a$.$ Dr$.$ Cost of goods sold $5,300$Cr$.$ Merchandise inventory $,5,300$b$.$ Dr$.$ Loss on inventory due to decline in value $4,700$Cr$.$ Allowance to reduce inventory to NRV $,4,700$c$.$ Dr$.$ Loss on inventory due to decline in value $5,300$Cr$.$ Allowance to reduce inventory to NRV $,5,300$d$.$ Dr$.$ Allowance to reduce inventory to NRV $4,700$Cr$.$ Recovery of loss on merchandise inventory $,4,700$Clear my choice

 

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estion 5 yet swered arked out of 1 Flag question Mawasem Co. has 1,000 units of inventory with a cost of $30,000 and a net realizable value of $25,000. Assuming the allowance method of adjusting to lower-of-cost-or-net realizable value is used, and allowance to reduce inventory to NRV account has a credit balance in the amount of $300, Mawasem record the following entry: O a. Dr. Cost of goods sold 5,300 Cr. Merchandise inventory 5,300 O b. Dr. Loss on inventory due to decline in value 4,700 Cr. Allowance to reduce inventory to NRV 4,700 O c. Dr. Loss on inventory due to decline in value 5,300 Cr. Allowance to reduce inventory to NRV 5,300 O d. Dr. Allowance to reduce inventory to NRV 4,700 Cr. Recovery of loss on merchandise inventory 4,700 Clear my choice estion 5 yet swered arked out of 1 Flag question Mawasem Co. has 1,000 units of inventory with a cost of $30,000 and a net realizable value of $25,000. Assuming the allowance method of adjusting to lower-of-cost-or-net realizable value is used, and allowance to reduce inventory to NRV account has a credit balance in the amount of $300, Mawasem record the following entry: O a. Dr. Cost of goods sold 5,300 Cr. Merchandise inventory 5,300 O b. Dr. Loss on inventory due to decline in value 4,700 Cr. Allowance to reduce inventory to NRV 4,700 O c. Dr. Loss on inventory due to decline in value 5,300 Cr. Allowance to reduce inventory to NRV 5,300 O d. Dr. Allowance to reduce inventory to NRV 4,700 Cr. Recovery of loss on merchandise inventory 4,700 Clear my choice

Answer rating: 100% (QA)

Answer The correct answer is option b Dr Loss on inventory due to decline in value 4700 Cr Allowance ... View the full answer