The inventory of 3T Company on December 31, 2014, consists of the following items.

Part No.			Quantity			Cost per Unit			Cost to Replace per Unit
110			650			$133			$148
111			1,060			89			77
112			540			118			112
113			220			252			266
120			470			303			308
121	a		1,600			24			21
122			400			355			348

^a Part No. 121 is obsolete and has a realizable value of $0.74 each as scrap.

(a) Determine the inventory as of December 31, 2014, by the lower-of-cost-or-market method, applying this method directly to each item.

(b) Determine the inventory by the lower-of-cost-or-market method, applying the method to the total of the inventory.

Answer rating: 100% (QA)

a Net realizable value NRV equals estimated selling price i... View the full answer