Item1

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Item1

Item 1 10 points

A physical inventory of Liverpool Company taken at December 31 reveals the following.

		Per Unit
Item	Units	Cost			Market
Car audio equipment
Speakers	353	$	108		$	116
Stereos	268		129			119
Amplifiers	334		104			113
Subwoofers	212		70			60
Security equipment
Alarms	488		168			158
Locks	299		111			101
Cameras	220		330			340
Binocular equipment
Tripods	193		92			102
Stabilizers	178		113			123

Required: 1. Calculate the lower of cost or market for the inventory applied separately to each item. 2. If the market amount is less than the recorded cost of the inventory, then record the LCM adjustment to the Merchandise Inventory account.