The notes are an important part of a company's financial statements, giving valuable details that would clutter the tabular data presented in the statements. This problem will help you learn to use a company's inventory notes. Refer to the Gildan Activewear Inc. financial statements and the related notes in Appendix A and on MyAccountingLab. Answer the following questions:
1. Refer to Note 3 Inventories. Gildan wrote down inventory to net realizable value in 2011 and 2010. What does net realizable value mean, and how much was the write-down in each year?
2. What valuation method does Gildan use for valuing each category of inventory?
3. What costs are included in the calculation of finished goods inventory?