Question

Switzer, Inc. has 8 computers which have been part of the inventory for over two years. Each computer cost $600 and originally retailed for $900. At the statement date, each computer has a current replacement cost of $400. How much loss should Switzer, Inc., record for the year?

Answer 1

Loss on the computers will be $1600

Step-by-step explanation:

We have given number of computers = 8

After two year each computer has a cost of $600 and originally retailed for $900

And current replacement price = $400

We have to find the loss

Now cost of 8 computers = 8×600 = $4800

Replacement cost of 8 computers = 8×$400 = $3200

So loss will be equal to = $4800 - $3200 = $1600

So loss on the computers will be $1600