Question: A particular production process requires two types of raw materials to produce the end product. Each unit of finished product requires three units of raw

A particular production process requires two types of raw materials to produce the end product. Each unit of finished product requires three units of raw material A and 2 units of raw material B and processing costs of $40. The following provides information on inventories at year-end:

Required:
a. Evaluate these inventories to determine the amount of write-down, if any.
b. Would your answer change if the replacement cost of raw material A were to be $21/unit?

Cost per Replacement Net realizable Inventory item Finished goods Raw material A Raw material B # Units 300 200 100 unit S200 20 50 cost n/a $25 45 value $180 n/a n/a

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a The finished products NRV cost Therefore it needs to be written down by 20 per unit on 30... View full answer

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