Nolen Company is preparing the annual financial statements dated December 31 2016. Information about inventory stocked for regular sale follows: $A50$20$19B1004545C205962D404036\begin{array} { c c c c } \text { Item } & \begin{array} { c } \text { Quantity } \\\text { on Hand }\end{array} & \begin{array} { c } \text { Unit Cost } \\\text { When Acquired }\end{array} & \begin{array} { c } \text { Replacement Cost } \\\text { (market) at year end }\end{array} \\\hline\mathrm { A } & 50 & \$ 20 & \$ 19 \\\mathrm { B } & 100 & 45 & 45 \\\mathrm { C } & 20 & 59 & 62 \\\mathrm { D } &40&40&36\end{array}$ Instructions
Compute the valuation for the December 31 2016 inventory using the lower-of-cost-or-market basis.

Question

Nolen Company is preparing the annual financial statements dated December 31 2016. Information about inventory stocked for regular sale follows:

A50$20$19B1004545C205962D404036\begin{array} { c c c c } \text { Item } & \begin{array} { c } \text { Quantity } \\\text { on Hand }\end{array} & \begin{array} { c } \text { Unit Cost } \\\text { When Acquired }\end{array} & \begin{array} { c } \text { Replacement Cost } \\\text { (market) at year end }\end{array} \\\hline\mathrm { A } & 50 & \$ 20 & \$ 19 \\\mathrm { B } & 100 & 45 & 45 \\\mathrm { C } & 20 & 59 & 62 \\\mathrm { D } &40&40&36\end{array}

Instructions
Compute the valuation for the December 31 2016 inventory using the lower-of-cost-or-market basis.

Gracie Webster · Accepted Answer

Final Answer :   Lower of Cost or   Item   Units   Market Value   Extension  A 50 $ 19 $ 950 B 100 45 4 , 500 C 20 59 1 , 180 D 40 36 1 , 440 ‾ $ 8.070 ‾ \begin{array}{cccc} &   &  	ext { Lower of Cost or } \	ext { Item }  &  	ext { Units }  &  	ext { Market Value }  & 	ext { Extension }\\hline\mathrm{A}  &  50  &  \$ 19  &  \$ 950 \\mathrm{B}  &  100  &  45  &  4,500 \\mathrm{C}  &  20  &  59  &  1,180 \\mathrm{D}  &  40  &  36  &   \underline{1,440} \ &   &   &   \underline{\$ 8.070}\end{array}  Item  A B C D ​  Units  50 100 20 40 ​  Lower of Cost or   Market Value  $19 45 59 36 ​  Extension  $950 4 , 500 1 , 180 1 , 440 ​ $8.070 ​ ​ ​

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