Question

When evaluating its year-end inventory at the end of fiscal 2017, a company determines that its inventory is valued $250,000 to $350,000 above NRV. What is the impact on the balance sheet and income statement in 2017 and 2018 if the inventory is written down by
$250,000 is 2017? What is the impact if the inventory is written down by $350,000 in 2017? What accounting concept might lead management to use the higher amount for the write down? Explain. Assume the written-down inventory is sold in 2018.



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  • CreatedFebruary 26, 2015
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