The following information pertains to each unit of merchandise purchased for resale by Vend Co.:
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|
March 1, 2006 |
|
|
Purchase price |
$ 8 |
|
Selling price |
$12 |
|
Price level index |
110 |
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December 31, 2006 |
|
|
Replacement cost |
$10 |
|
Selling price |
$15 |
|
Price level index |
121 |
Under current cost accounting, what is the amount of Vend’s holding gain on each unit of this merchandise?
- $0
- $0.80
- $1.20
- $2.00