Question

Andrews Corp. ended the year carrying $24,884,000 worth of inventory. Had they sold their entire inventory...

Andrews Corp. ended the year carrying $24,884,000 worth of inventory. Had they sold their entire inventory at their current prices, how much more revenue would it have brought to Andrews Corp.?

Homework Answers

Answer #1

It is not mentioned in the problem statement whether inventory is valued at cost or price.

If inventory is valued at cost , it will definitely be valued less than price.

Nonetheless, reduction in inventory increases sales and therefore revenue of the company.

Assuming inventory is valued at cost , the revenue will definitely increase at least by $24,884,000 . ( since price / unit > Cost / unit )

If inventory is valued at price, the revenue will increase by $24,884,000

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