Home Stop sells two product categories, furniture and accessories. Information pertaining to its 2021 year-end inventory is as follows:

Required:1. Determine the carrying value of inventory at year-end, assuming the lower of cost or market (LCM) rule is applied to (a) individual products, (b) product categories, and (c) total inventory.2. Assuming inventory write-downs are common for Home Stop, record any necessary year-end adjusting entry for each of the LCM applications in requirement 1.

Transcribed Image Text:

Inventory, by Product Category Furniture: Chairs Desks Tables Accessories: Rugs Lamps Per Unit Quantity Cost Market $25 $31 10 73 84 58 92 20 60 40 48 30 22 18