Assume Red Corp. applies Lower of Cost or Net Realizable Value (LCNRV) directly to each individual inventory
Question:
Assume Red Corp. applies Lower of Cost or Net Realizable Value (LCNRV) directly to each individual inventory item. What is the total ending inventory value Red Corp. will report?
Assume Red Corp. applies Lower of Cost or Market (LCM) directly to each individual inventory item. What is the ending inventory value Red Corp. will report for Item A?
Assume Red Corp. applies Lower of Cost or Market (LCM) directly to each individual inventory item. What is the ending inventory value Red Corp. will report for Item B?
At the end of its accounting cycle, Red Corp. provided the following chart to its accountants:
Cost | Replacement Cost | Net Realizable Value (NRV) | NRV less Normal Profit | |
Item A | $550 | $570 | $580 | $500 |
Item B | $875 | $870 | $810 | $790 |
Item C | $300 | $260 | $275 | $160 |
Item D | $50 | $75 | $90 | $88 |
Item E | $230 | $200 | $210 | $197 |
Item F | $770 | $600 | $575 | $500 |
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College Accounting Chapters 1-30
ISBN: 978-1259631115
15th edition
Authors: John Price, M. David Haddock, Michael Farina