Question

Pronghorn 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			$3.87			$3.63			$5.45			$0.42			$1.51
1333		1,200			3.27			2.78			4.24			0.61			0.61
1426		1,100			5.45			4.48			6.05			0.48			1.21
1437		1,300			4.36			3.75			3.87			0.30			1.09
1510		1,000			2.72			2.42			3.93			0.97			0.73
1522		800			3.63			3.27			4.60			0.48			0.61
1573		3,300			2.18			1.94			3.03			0.91			0.61
1626		1,300			5.69			6.29			7.26			0.61			1.21

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

The amount of Pronghorn Company’s inventory

Answer 1

Item No.	Quantity	Cost per Unit	Cost to Replace	Estimated Selling Price	Cost of Completion and Disposal	Normal Profit	NRV	NRV less normal profit	Market	Lower of cost or market	Inventory value
1320	1,500	$3.87	$3.63	$5.45	$0.42	$1.51	$5.03	$3.52	$3.63	$3.63	$5,445
1333	1,200	3.27	2.78	4.24	0.61	0.61	$3.63	$3.02	$3.02	$3.02	$3,624
1426	1100	5.45	4.48	6.05	0.48	1.21	$5.57	$4.36	$4.48	$4.48	$4,928
1437	1,300	4.36	3.75	3.87	0.3	1.09	$3.57	$2.48	$3.57	$3.57	$4,641
1510	1000	2.72	2.42	3.93	0.97	0.73	$2.96	$2.23	$2.42	$2.42	$2,420
1522	800	3.63	3.27	4.6	0.48	0.61	$4.12	$3.51	$3.51	$3.51	$2,808
1573	3,300	2.18	1.94	3.03	0.91	0.61	$2.12	$1.51	$1.94	$1.94	$6,402
1626	1,300	5.69	6.29	7.26	0.61	1.21	$6.65	$5.44	$6.29	$5.69	$7,397
										Total	$37,665
The amount of Pronghorn Company’s inventory $37665