Problem - Lower-of-Cost-or-Market
The inventory of Oheto Company on December 31, 2011, consists of the following items.
|
Part No.
|
Quantity
|
Cost per Unit
|
Cost to Replace per Unit
|
|
110
|
600
|
$95
|
$100
|
|
111
|
1,000
|
60
|
52
|
|
112
|
500
|
80
|
76
|
|
113
|
200
|
170
|
180
|
|
120
|
400
|
205
|
208
|
|
121
|
1,600
|
16
|
14
|
|
122
|
300
|
240
|
235
|
(a) Determine the inventory as of December 31, 2011, by the lower-of-cost-or-market method, applying this method directly to each item.
(b) Determine the inventory by the lower-of-cost-or-market method, applying the method to the total of the inventory.