Question

Lower-of-Cost-or-Market Inventory

On the basis of the following data:

Commodity	Inventory Quantity	Unit Cost Price	Unit Market Price
AL65	42	$179	$174
CA22	46	89	89
LA98	30	276	295
SC16	11	116	134
UT28	21	213	222

Determine the value of the inventory at the lower of cost or market. Assemble the data in the form illustrated in Exhibit 10.

Inventory at the Lower of Cost or Market
Commodity	Total Cost	Total Market	Total Lower of C or M
AL65
CA22
LA98
SC16
UT28
TOTAL

Answer 1

			Inventory value
Items	Cost per unit	Market value per unit	Per Unit as per Lower of cost or market value	Number of units	Total Value
AL65	$             179.00	$ 174.00	$ 174.00	42	$         7,308.00
CA22	$                89.00	$    89.00	$    89.00	46	$         4,094.00
LA98	$             276.00	$ 295.00	$ 276.00	30	$         8,280.00
SC16	$             116.00	$ 134.00	$ 116.00	11	$         1,276.00
UT28	$             213.00	$ 222.00	$ 213.00	21	$         4,473.00
Total ending inventory					$       25,431.00

Inventory at the Lower of Cost or Market
Commodity	Total Cost	Total Market	Total Lower of C or M
AL65	$7,518	$7,308	$7,308
CA22	$4,094	$4,094	$4,094
LA98	$8,280	$8,850	$8,280
SC16	$1,276	$1,474	$1,276
UT28	$4,473	$4,662	$4,473
TOTAL	$25,641	$26,388	$25,431