A$.$ At $12/31/22,$ the end of Jenner Company's first year of business, inventory was $$6,100$ and $$5,100$ at cost and at market, respectively.

Following is data relative to the $12/31/23$ inventory of Jenner:

Original Net Net Realizable Appropriate

Cost Replacement Realizable Value Less Inventory

Item Per Unit Cost Value Normal Profit Value

A $ $\mathrm{.}65$ $ $\mathrm{.}45$

B $\mathrm{.}45\mathrm{.}40$

C $\mathrm{.}70\mathrm{.}75$

D $\mathrm{.}75\mathrm{.}65$

E $\mathrm{.}90\mathrm{.}85$

Selling price is $$1\mathrm{.}00/$unit for all items. Disposal costs amount to $10\%$ of selling price and a "normal" profit is $30\%$ of selling price. There are $1,500$ units of each item in the $12/31/21$ inventory.

Instructions

$($a$)$ Prepare the entry at $12/31/20$ necessary to implement the lower$-$of$-$cost$-$or$-$market procedure assuming Jenner uses a contra account for its balance sheet.

$($b$)$ Complete the last three columns in the $12/31/21$ schedule above based upon the lower$-$of$-$cost$-$or$-$market rules.

$($c$)$ Prepare the entry$($ies$)$ necessary at $12/31/21$ based on the data above.

$($d$)$ How are inventory losses disclosed on the income statement?

Resolver con procedimiento.