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8 July, 14:36

Robust Inc. has the following information related to an item in its ending inventory. Product 66 has a cost of $162, a replacement cost of $155, a net realizable value of $160, and a normal profit margin of $10. What is the final lower-of-cost-or-market inventory value for product 66?

$160.

$152.

$162.

$155.

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Answers (1)
  1. 8 July, 16:16
    0
    final lower-of-cost-or-market inventory value is $155

    correct option is $155

    Explanation:

    given data

    product cost = $162

    replacement cost = $155

    realizable value = $160

    profit margin = $10

    to find out

    final lower-of-cost-or-market inventory value

    solution

    we know that according to the inventory accounting that

    inventory value is the lower of cost or the market value or the replacement cost is taking as basis for the inventory fair value so

    here we have given value $162 and $155 and $160

    so the lower value of all these is $155

    so final lower-of-cost-or-market inventory value is $155

    correct option is $155
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