Answer:
Curlz should report his inventory at a Total value of $3,270
Explanation:
In reporting inventory, the market values are only used when the price of a particular commodity or product falls below the purchase value.The inventory will therefor register a loss if the price falls. However, when the market value rises above the purchase value, we use the purchase value in our inventory since the rules of accounting do not allow for anticipated profits: they can only be reported once the sale is made and the market value at that point in time is higher than the purchase value.
The inventory will include;
Initial values;
Number of bottles of Clean Z=370 bottles
Price per bottle of clean Z=$3
Number of boxes of Dye Z=270 boxes
Price per Dye Z=$10
Market values;
Price per bottle of clean Z=$3.20
Price per box of Dye Z=$8
Inventory report;
Since market value of clean Z ($3.20)is greater than its initial value ($3), then in our inventory we will use the lesser value=$3 per bottle for 370 bottles.
Additionally, since market value of dye Z ($8) is lesser than its initial value ($10), then in our inventory we will use the lesser value=$8 per box for 270 boxes
The total value of the inventory will be;
Total value=(Number of bottles of Clean Z×price per bottle of clean Z)+(Number of boxes of Dye Z×price per Dye Z)
where;
Number of bottles of Clean Z=370 bottles
price per bottle of clean Z=$3
Number of boxes of Dye Z=270 boxes
price per box of Dye Z=$8
replacing;
Total value=(370×3)+(270×8)=$3,270
Total value=$3,270
