Ivanhoe Home Improvement Company installs replacement siding, windows, and louvered glass doors for single-family homes and...

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Ivanhoe Home Improvement Company installs replacement siding, windows, and louvered glass doors for single-family homes and condominium complexes. The company is in the process of preparing its annual financial statements for the fiscal year ended May 31, 2025. Jim Alcide, controller for Ivanhoe, has gathered the following data concerning inventory. At May 31, 2025, the balance in Ivanhoe's Raw Materials Inventory account was $510,000. Alcide summarized the relevant inventory cost and market data at May 31, 2025, in the schedule below. Alcide assigned Patricia Devereaux, an intern from a local college, the task of calculating the amount that should appear on Ivanhoe's May 31, 2025, financial statements for inventory under the lower-of-cost-or-market rule as applied to each item in inventory. Devereaux expressed concern over departing from the historical cost principle. Consider the following expanded data at May 31, 2025, Assume Ivanhoe uses LIFO inventory costing. Aluminum siding Cedar shake siding Louvered glass doors Thermal windows Total Inventory loss Cost $87.500 107,500 140,000 175,000 $510,000 $ Replacement Cost $78,125 99,250 155,000 157,500 $489,875 Sales Price $80,000 117,500 233,000 193,500 $624,000 (a1) Determine the write-down, if any, to reduce inventory to market at May 31, 2025 Net Realizable Value $70,000 106,000 210,375 175,000 $561.375 Normal Profit $6,375 9,250 23,125 19,250 $58,000 (a2) For the fiscal year ended May 31, 2025, prepare the entry to record the decline in inventory to market, if any, using the loss method. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter 0 for the amounts.) Ivanhoe Home Improvement Company installs replacement siding, windows, and louvered glass doors for single-family homes and condominium complexes. The company is in the process of preparing its annual financial statements for the fiscal year ended May 31, 2025. Jim Alcide, controller for Ivanhoe, has gathered the following data concerning inventory. At May 31, 2025, the balance in Ivanhoe's Raw Materials Inventory account was $510,000. Alcide summarized the relevant inventory cost and market data at May 31, 2025, in the schedule below. Alcide assigned Patricia Devereaux, an intern from a local college, the task of calculating the amount that should appear on Ivanhoe's May 31, 2025, financial statements for inventory under the lower-of-cost-or-market rule as applied to each item in inventory. Devereaux expressed concern over departing from the historical cost principle. Consider the following expanded data at May 31, 2025, Assume Ivanhoe uses LIFO inventory costing. Aluminum siding Cedar shake siding Louvered glass doors Thermal windows Total Inventory loss Cost $87.500 107,500 140,000 175,000 $510,000 $ Replacement Cost $78,125 99,250 155,000 157,500 $489,875 Sales Price $80,000 117,500 233,000 193,500 $624,000 (a1) Determine the write-down, if any, to reduce inventory to market at May 31, 2025 Net Realizable Value $70,000 106,000 210,375 175,000 $561.375 Normal Profit $6,375 9,250 23,125 19,250 $58,000 (a2) For the fiscal year ended May 31, 2025, prepare the entry to record the decline in inventory to market, if any, using the loss method. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter 0 for the amounts.)

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1 Calculation for each inventory item Aluminum Siding Cost 87500 Market Value Lower of Replacement C... View the full answer