Question

Bonita Company follows the practice of pricing its inventory at the lower-of-cost-or-market, on an individual-item basis. Item No. Quantity Cost Cost to Estimated Cost of Normal . per Unit Replace Selling Price Completion Profit and Disposal1320 1,700 $3.49 $3.27 $4.91 $0.38 $1.36 1333 1,400 2.94 2.51 3.82 0.55 0.55 1426 1,300 4.91 4.03 5.45 0.44 1.09 1437 1,500 3.92 3.38 3.49 0.27 0.98 1510 1,200 2.45 2.18 3.54 0.87 0.65 1522 1,000 3.27 2.94 4.14 0.44 0.55 1573 3,500 1.96 1.74 2.73 0.82 0.55 1626 1,500 5.12 5.67 6.54 0.55 1.09From the information above, determine the amount of Bolton Company inventory.

Answer 1

Answer:

Explanation:

Amount of Bolton Company inventory = 38,972

Calculations are attached

1. Find net realizable value, which is selling price - cost of disposal;

2. Then subtract normal profit from net realizable value = [g];

3. Find designated market value by choosing the middle value of cost to replace, net realizable value and [g];

4. Choose lowest between designated market value and selling price;

5. Multiply by quantity.