At 12/31/21, the end of Bell Company's first year of business, inventory was $158,800 and $157,900 at cost and at net realizable value, respectively. Bell uses FIFO for valuing inventories, and they apply the lower of cost or net realizable value on an individual item basis to compute the inventory valuation on 12/31/21. Bell uses the allowance method to reduce inventories, as needed. The following table displays information for Bell's inventory at 12/31/22. Product A-1 A-2 B-1 B-2 B-3 C-1 Cost 12.00 13.50 38.40 42.50 44.20 68.00 Replacment Cost 11.00 13.00 36.00 42.00 45.00 68.00 What journal entry is required at 12/31/22? Selling Price 15.00 18.00 48.00 50.00 52.00 80.00 Costs to complete 4.00 3.00 8.00 8.00 8.00 9.00 Normal Profit on Sales 20% 25% 20% 15% 15% 15% Quantity 1,200 1,000 900 800 750 500
At 12/31/21, the end of Bell Company's first year of business, inventory was $158,800 and $157,900 at cost and at net realizable value, respectively. Bell uses FIFO for valuing inventories, and they apply the lower of cost or net realizable value on an individual item basis to compute the inventory valuation on 12/31/21. Bell uses the allowance method to reduce inventories, as needed. The following table displays information for Bell's inventory at 12/31/22. Product A-1 A-2 B-1 B-2 B-3 C-1 Cost 12.00 13.50 38.40 42.50 44.20 68.00 Replacment Cost 11.00 13.00 36.00 42.00 45.00 68.00 What journal entry is required at 12/31/22? Selling Price 15.00 18.00 48.00 50.00 52.00 80.00 Costs to complete 4.00 3.00 8.00 8.00 8.00 9.00 Normal Profit on Sales 20% 25% 20% 15% 15% 15% Quantity 1,200 1,000 900 800 750 500
Chapter10: Inventory
Section: Chapter Questions
Problem 14EB: If Barcelona Companys ending inventory was actually $122,000, but the cost of consigned goods, with...
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