Question

Using the lower of cost or market, what should the total inventory value be for the following items:

Item Quantity Unit Cost Price Unit Market Price Total Cost Price Total Market Price
A 300 $15.00 $14.50 $4,500 $4,350
B 200 $14.00 $15.00 $2,800 $3,000
C 100 $17.00 $17.50 $1,700 $1,750

Apply the lower-of-cost-or-market method to inventory as a whole.

Answer 1

The total inventory value based on the lower-of-cost-or-market value method applied to inventory as a whole is:

= $9,000.

Step-by-step explanation:

a) Data and Calculations:

Item Quantity Unit Cost Unit Market Total Cost Total Market

Price Price Price Price

A 300 $15.00 $14.50 $4,500 $4,350

B 200 $14.00 $15.00 $2,800 $3,000

C 100 $17.00 $17.50 $1,700 $1,750

Total cost or market price $9,000 $9,100