Michael Bolton Company follows the practice of pricing its inventory at the lowe
ID: 2451492 • Letter: M
Question
Michael Bolton Company follows the practice of pricing its inventory at the lower-of-cost-or-market, on an individual-item basis.
Item No.
Quantity
Cost per Unit
Cost to Replace
Estimated Selling Price
Cost of Completion and Disposal
Normal Profit
From the information above, determine the amount of Bolton Company inventory.
Item No.
Quantity
Cost per Unit
Cost to Replace
Estimated Selling Price
Cost of Completion and Disposal
Normal Profit
1320 1,700 $5.47 $5.13 $7.70 $0.60 $2.14 1333 1,400 4.62 3.93 5.99 0.86 0.86 1426 1,300 7.70 6.33 8.55 0.68 1.71 1437 1,500 6.16 5.30 5.47 0.43 1.54 1510 1,200 3.85 3.42 5.56 1.37 1.03 1522 1,000 5.13 4.62 6.50 0.68 0.86 1573 3,500 3.08 2.74 4.28 1.28 0.86 1626 1,500 8.04 8.89 10.26 0.86 1.71Explanation / Answer
Answer:
Item No. Cost per unit Replacement cost Net realizable value NRV less Normal profit Designated market value Lower of cost or market Qty Final inventory value 1320 5.47 5.13 7.1 4.96 5.13 5.13 1700 8721 1333 4.62 3.93 5.13 4.27 4.27 4.27 1400 5978 1426 7.7 6.33 7.87 6.16 6.33 6.33 1300 8229 1437 6.16 5.3 5.04 3.5 5.04 5.04 1500 7560 1510 3.85 3.42 4.19 3.16 3.42 3.42 1200 4104 1522 5.13 4.62 5.82 4.96 4.96 4.96 1000 4960 1573 3.08 2.74 3 2.14 2.74 2.74 3500 9590 1626 8.04 8.89 9.4 7.69 8.89 8.04 1500 12060 61202