Presented below is data relative to the 12/31/12 inventory of Lance Company:
Number Units Original Cost Total Current
Item In Inventory Per Unit Original Cost Replacement Cost
A 5,000 $1.09 $5,450 $1.08
B 5,000 1.30 6,500 1.15
C 5,000 1.50 7,500 1.05
D 5,000 1.60 8,000 1.65
E 5,000 1.80 9,000 1.70
Total 25,000 $36,450
Appropriate
Upper Lower Inventory
Limit Limit Designated Valuation
Item (“Ceiling”) (“Floor”) Market (Totals)
A
B
C
D
E
Total
Additional Data:
Selling price is $2.00/unit for all items. Disposal costs amount to 10% of selling price and a “normal” profit is 35% of selling price.
Instructions
Complete the last four columns above.