Lower of Cost or Market Valuation
The following inventory data are available for Nordic Ski Shop at December 31.
1. Determine the value of ending inventory using the lower of cost or market method applied to (a) individual items and (b) total inventory.
2. Prepare any journal entries required to adjust the ending inventory if lower of cost or market is applied to (a) individual items and (b) total inventory.
|
|
Cost |
Market |
|
Skis |
$55,000 |
$62,000 |
|
Boots |
42,500 |
38,000 |
|
Ski equipment |
18,000 |
16,500 |
|
Ski apparel |
10,000 |
12,000 |