Question

The inventory of Oheto Company on December 31, 2020, consists of the following items.

Part			Quantity		Cost per Unit		Net Realizable Value
110			600		$95.00		$100.00
111			1,000		60.00		52.00
112			500		80		76.00
113			200		170		180.00
120			400		205.00		208.00
121	a		1,600		16.00		1.00
122			300		240		235.00

^a Part No. 121 is obsolete and has a realizable value of $1.00 each as scrap.

(a) Determine the inventory as of December 31, 2020, by the LCNRV method, applying this method to each item.

Inventory as of December 31, 2020

$enter the Inventory as of December 31 in dollars

(b) Determine the inventory by the LCNRV method, applying the method to the total of the inventory.

Inventory as of December 31, 2020

$enter the Inventory as of December 31 in dollars

Answer 1

Part No.	Quantity	Per Unit Cost	Market	Total Cost	Total Market	Lower of Cost or Market
110	600	$95	$100	$57,000	$60,000	$57,000
111	1,000	$60	$52	$60,000	$52,000	$52,000
112	500	$80	$76	$40,000	$38,000	$38,000
113	200	$170	$180	$34,000	$36,000	$34,000
120	400	$205	$208	$82,000	$83,200	$82,000
121a	1,600	$16	$1	$25,600	$1,600	$1,600
122	300	$240	$235	$72,000	$70,500	$70,500
				$370,600	$341,300	$335,100

a) The valuation of inventory as of December 31, 2020, by the lower of cost or market method, as applied directly to each item is $335,100

b) The valuation of inventory as of December 31, 2020, by the lower of cost or market method, as applied to total inventory is $341,300