The balance sheet value of a firm's inventory is $55,000. Suppose that the firm purchases supplies at a cost of $4,500 and adds them to inventory. A day later, the market value of the recently purchased supplies changes to $3,500.

Assuming no other changes to inventory, and using the historical cost method.

What is the final balance sheet value of inventory?

Answer rating: 100% (QA)

Under the historical cost method inventory is recorded at its original ... View the full answer