Question

Herman Company has three products in its ending inventory. Specific per unit data at the end of the year for each of the products are as follows: Product 1 Product 2 Product 3 Cost $ 35 $ 105 $ 65 Selling price 85 165 115 Costs to sell 8 70 25 Required: What unit values should Herman use for each of its products when applying the lower of cost or net realizable value (LCNRV) rule to ending inventory

Answer 1

Cost Selling Price Costs to Sell NRV Inventory value

A B C D=(B-C) E=(lowerof A&D)

Product 1 35 85 8 77 35

Product 2 105 165 70 95 95

Product 3 65 115 25 90 65