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As a result of a water leak during July, a portion of XYZ Ltds inventory was damaged. After assessing the damaged goods, the following values were determined on July 31:- Net Realizable Itemp Units* 5,000 3,000 2,000 Cost per UnitValue per Unit $25 S35 $80 $15 $30 $85+ Bo What inventory value should be reported at July 31 a. $400,000v b. $335,000 c. $390,000v d. $325,000

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Answer #1

Calculate inventory value :

Item Units Cost NRV Lower of cost of NRV Inventory value
A 5000 25 15 15 75000
B 3000 35 30 30 90000
C 2000 80 85 80 160000
Total 325000

So answer is d) $325000

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