Question

Exercise 6-13A Calculate inventory using lower of cost and net realizable value (LO6-6) Skip to question [The following information applies to the questions displayed below.] Home Furnishings reports inventory using the lower of cost and net realizable value (NRV). Below is information related to its year-end inventory. Inventory Quantity Unit Cost Unit NRV Furniture 290 $ 94 $ 109 Electronics 59 490 345

Answer 1

Answer:

The ending inventory is $56,170 using the lower of cost and net realizable value.

Explanation:

With regards to the above, the conservative principle of accounting would be maintained by the company, hence would report its inventory at the lowest value.

Furniture [ 290 units × $94 each]

$27,260

Electronics [ 59 units × $490]

$28,910

Total ending inventory

$56,170