A company’s normal selling price for its product is $27 per unit. However, due to market competition, the selling price has fallen to $22 per unit. This company's current FIFO inventory consists of 270 units purchased at $23 per unit. Net realizable value has fallen to $20 per unit. Calculate the value of this company's inventory at the lower of cost or market.
Multiple Choice
$5,500.
$5,350.
$6,210.
$5,400.
$5,940.
|
Cost of inventory = 270 units * 22 = 5,940 Net realize value = 270 units * 20 = 5,400 Inventory should be reported at lower of 5,940 or 5,400 = 5,400 Option D is the answer |
||
A company’s normal selling price for its product is $27 per unit. However, due to market...