1. The following inventory information was taken from the records of GlobeKom Ltd.: C. Historical cost...

 

Transcribed Image Text:

1. The following inventory information was taken from the records of GlobeKom Ltd.: C. Historical cost Replacement cost Expected selling price Expected selling cost Normal profit margin $12,000 $9,000 $10,000 $500 10% of selling price a. Under IAS 2, what value should the balance sheet report for Inventory? b. Under U.S. GAAP, what value should the balance sheet report for Inventory? If the "Replacement cost" was $9,999, would it change your answer for (a) or (b)? Please explain your answer. 1. The following inventory information was taken from the records of GlobeKom Ltd.: C. Historical cost Replacement cost Expected selling price Expected selling cost Normal profit margin $12,000 $9,000 $10,000 $500 10% of selling price a. Under IAS 2, what value should the balance sheet report for Inventory? b. Under U.S. GAAP, what value should the balance sheet report for Inventory? If the "Replacement cost" was $9,999, would it change your answer for (a) or (b)? Please explain your answer.