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Alinara [238K]
3 years ago
6

Given the acquisition cost of product ALPHA is $20, the net realizable value for product ALPHA is $17, the normal profit for pro

duct ALPHA is $1.50, and the market value (replacement cost) for product ALPHA is $14, what is the proper per unit inventory value for product ALPHA applying LCM?
Business
1 answer:
Anna [14]3 years ago
3 0

Answer:

LCM = $15.5

Explanation:

RC = $14

Ceiling: NRV = $17

Floor: NRV – PM

Net realizable value for product ALPHA -Normal profit for product ALPHA

= $17 – $1.50= $15.5

Market= $15.5

LCM = $15.5

Therefore the proper per unit inventory value for product ALPHA applying LCM will be $15.5

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Explanation:

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