Question

Skysong 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
1320		1,500			$3.39			$3.18			$4.77			$0.37			$1.33
1333		1,200			2.86			2.44			3.71			0.53			0.53
1426		1,100			4.77			3.92			5.30			0.42			1.06
1437		1,300			3.82			3.29			3.39			0.27			0.95
1510		1,000			2.39			2.12			3.45			0.85			0.64
1522		800			3.18			2.86			4.03			0.42			0.53
1573		3,300			1.91			1.70			2.65			0.80			0.53
1626		1,300			4.98			5.51			6.36			0.53			1.06

From the information above, determine the amount of Skysong Company inventory.

Answer 1

Answer- The amount of Skysong Company inventory= $35333.

Explanation-

Statement of Inventory using Lower of cost or market
Item No.	Units	Cost per unit $	Estimated Selling price $ (a)	Cost to complete & Sell (b)	Net Relizable value (c=a-b)	Lower of cost or Net realizable value	Value of Inventory $	Remark (Valued at)
1320	1500	3.39	4.77	0.37	4.40	3.39	5085	Cost price
1333	1200	2.86	3.71	0.53	3.18	2.86	3432	Cost price
1426	1100	4.77	5.30	0.42	4.88	4.77	5247	Cost price
1437	1300	3.82	3.39	0.27	3.12	3.12	4056	Net Realizable
1510	1000	2.39	3.45	0.85	2.60	2.39	2390	Cost price
1522	800	3.18	4.03	0.42	3.61	3.18	2544	Cost price
1573	3300	1.91	2.65	0.80	1.85	1.85	6105	Net Realizable
1626	1300	4.98	6.36	0.53	5.83	4.98	6474	Cost price
						Total	35333