Homework SourseLowerofCostorMarket Inventory On the basis of the following
Lower-of-Cost-or-Market Inventory
On the basis of the following data, determine the value of the inventory at the lower of cost or market. Assemble the data in the form illustrated in Exhibit 9.
Inventory
Item
Inventory
Quantity
Cost per
Unit
Market Value per Unit
(Net Realizable Value)
| Inventory | Inventory | Cost per | Market Value per Unit | |
| Birch | 100 | $125 | $120 | |
| Cypress | 75 | 100 | 108 | |
| Mountain Ash | 80 | 90 | 86 | |
| Spruce | 130 | 74 | 80 | |
| Willow | 60 | 105 | 98 |
Solution
Answer
Commodity
Total Cost
Total market
Total lower of C or M
Birch
(100*125)=12500
(100*120)=12000
12000
Cypress
(75*100)=7500
(75*108)=8100
7500
Mountain Ash
(80*90)=7200
(80*86)=6880
6880
Spruce
(130*74)=9620
(130*80)=10400
9620
Willow
(60*105)=6300
(60*98)=5880
5880
Total
$43120
$43260
$43120
| Commodity | Total Cost | Total market | Total lower of C or M |
| Birch | (100*125)=12500 | (100*120)=12000 | 12000 |
| Cypress | (75*100)=7500 | (75*108)=8100 | 7500 |
| Mountain Ash | (80*90)=7200 | (80*86)=6880 | 6880 |
| Spruce | (130*74)=9620 | (130*80)=10400 | 9620 |
| Willow | (60*105)=6300 | (60*98)=5880 | 5880 |
| Total | $43120 | $43260 | $43120 |
