Question
In: Accounting
Exercise 5-10 Lower of cost or market LO P2 Martinez Company's ending inventory includes the following...
Exercise 5-10 Lower of cost or market LO P2
Martinez Company's ending inventory includes the following
items.
| Product | Units | Cost per Unit | Market per Unit | ||||||
| Helmets | 37 | $ | 59 | $ | 55 | ||||
| Bats | 30 | 77 | 83 | ||||||
| Shoes | 51 | 96 | 100 | ||||||
| Uniforms | 55 | 41 | 41 | ||||||
Compute the lower of cost or market for ending inventory applied
separately to each product.
Solutions
Expert Solution
Answer------------$11,496
Working
| Inventory value | |||||
| Items | Cost per unit | Market value per unit |
Per Unit value as per Lower of cost or market value |
Number of units | Total Value |
| Helmets | $ 59.00 | $ 55.00 | $ 55.00 | 37 | $ 2,035.00 |
| Bats | $ 77.00 | $ 83.00 | $ 77.00 | 30 | $ 2,310.00 |
| Shoes | $ 96.00 | $ 100.00 | $ 96.00 | 51 | $ 4,896.00 |
| Uniforms | $ 41.00 | $ 41.00 | $ 41.00 | 55 | $ 2,255.00 |
| $ - | |||||
| Total ending inventory | $ 11,496.00 | ||||
ekkarill92 answered 9 months agoRelated Solutions
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Item
Quantity
Unit Cost
Unit Market
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P1
62
$
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P2
31
63
73
P3
82
136
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Required
a. Determine the amount of ending inventory using
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The following information pertains to Hagen Metal Work’s ending
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Unit
Unit
Item
Quantity
Cost
Market Value
C
200
$
13
$
12
D
190
15
12
K
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11
13
M
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8
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Required
a. Determine the value of the ending inventory
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(Lower-of-Cost-or-Market) Wangerin Company follows
the practice of pricing its inventory at the
lower‐of‐cost‐or‐market, on an individual-item basis.
Item No.
Quantity
Cost per Unit
Cost to Replace
Estimated Selling Price
Cost of Completion and Disposal
Normal Profit
1320
1,200
$3.20
$3.00
$4.50
$0.35
$1.25
1333
900
2.70
2.30
3.50
0.50
0.50
1426
800
4.50
3.70
5.00
0.40
1.00
1437
1,000
3.60
3.10
3.20
0.25
0.90
1510
700
2.25
2.00
3.25
0.80
0.60
1522
500
3.00
2.70
3.80
0.40...
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The following list includes selected permanent accounts and all
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Debit
Credit
Merchandise inventory
$
32,000
Prepaid selling expenses
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K. Emiko, Withdrawals
37,000
Sales
$
545,000
Sales returns and allowances
18,300
Sales discounts
5,400
Cost of goods sold
220,000
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at the lower-of-cost-or-market, on an individual-item
basis.
Item No.
Quantity
Cost per Unit
Cost to Replace
Estimated Selling Price
Cost of Completion and Disposal
Normal Profit
1320
1,600
$3.46
$3.24
$4.86
$0.38
$1.35
1333
1,300
2.92
2.48
3.78
0.54
0.54
1426
1,200
4.86
4.00
5.40
0.43
1.08
1437
1,400
3.89
3.35
3.46
0.27
0.97
1510
1,100
2.43
2.16
3.51
0.86
0.65
1522
900
3.24
2.92
4.10
0.43
0.54
1573
3,400
1.94...
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Martinez Company follows the practice of pricing its inventory
at the lower-of-cost-or-market, on an individual-item
basis.
Item No.
Quantity
Cost per Unit
Cost to Replace
Estimated Selling Price
Cost of Completion and Disposal
Normal Profit
1320
1,600
$3.46
$3.24
$4.86
$0.38
$1.35
1333
1,300
2.92
2.48
3.78
0.54
0.54
1426
1,200
4.86
4.00
5.40
0.43
1.08
1437
1,400
3.89
3.35
3.46
0.27
0.97
1510
1,100
2.43
2.16
3.51
0.86
0.65
1522
900
3.24
2.92
4.10
0.43
0.54
1573
3,400
1.94...
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Item code
Quantity
Unit Cost
Unit Market
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100
$228
$232
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420
152
176
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600
168
176
Extra-Large
220
268
256
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Cost
Lower-of-Cost-or-Market
December 31, 2019
$81,780
$66,740
December 31, 2020
94,000
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December 31, 2021
91,180
91,180
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Football teams ending inventory includes the following items
product
units
cost per unit
market per unit
caps
200
$15
$22
travel Jerseys
55
$40
$125
windbreakers
18
$60
$85
signature stadium cushions
500
$20
$10
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per unit
per unit
total inventory
total inventory
inventory items
units
cost
market
cost
market
LCM Applied to individual items
caps
travel jerseys
windbreakers
signature stadium cushion
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