The Vandy Company had the following inventory at year-end:

Required

a. Determine the value of ending inventory after applying the lower-of-cost-or-net realizable value method to each item of inventory.

b. Would the net income be lower under the cost method or the lower-of-cost-or-net realizable value method?

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Unit Price Quantity Cost Net Realizable Value Fans Model X1.... 300 $18 $19 Model X2.. 250 Model X3. 450 22 23 24 29 25 Heaters Model B7. 500 Model B8. 290 Model B9. 100 41 4824 30 35 32 37