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3 years ago

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Exercise 6-9 Whispering Winds Corp. uses the lower-of-cost-or-market basis for its inventory. The following data are available a

t December 31. Units Cost per Unit Market per Unit Cameras Minolta 5 $180 $163 Canon 7 133 141 Light Meters Vivitar 11 125 112 Kodak 10 121 129 What amount should be reported on Whispering Winds Corp.’s financial statements, assuming the lower-of-cost-or-market rule is applied?

1 answer:

ehidna [41]3 years ago

6 0

Answer:

Minolta: 5 at $ 163 = $ 815

Canon: 7 at $ 133 = $ 931

Vivitar 11 at $ 112 = $ 1,232

Kodak 10 at $ 121 = $ <u> 1,210 </u>

Total Inventory: $ 4,188

Explanation:

We must value the inventory at the lower value between the historic cost and the market value of the assets. This is done to follow the conservatism principles of accounting.

Minolta: 5 at $ 163 = $ 815

Canon: 7 at $ 133 = $ 931

Vivitar 11 at $ 112 = $ 1,232

Kodak 10 at $ 121 = $ <u> 1,210 </u>

Total Inventory: $ 4,188

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