Dani Corporation signed a binding commitment on December 2 to purchase inventory at a cost of $300,000

Question:

Dani signed a binding commitment on December 2 to purchase inventory at a cost of $300,000 on January 2. By December 31, the market price (replacement cost) of the inventory had declined to $280,000. Prepare Dani Corporation’s journal entries at year-end and at the date of purchase.

Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...