Calculate lower-of-cost-or-net realizable value

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Reference no: EM132740615

Question - Lower-of-Cost-or-Net Realizable Value

The following information is from Gianni Company's individual inventory items as of December 31, 2020.

Inventory Quantity Cost per Unit Net Realizable Value per Unit

Classification: Premium

Item 1 256 $180 $185

Item 2 480 100 98

Item 3 640 165 175

Item 4 448 158 120

Classification: Classic

Item 5 320 100 98

Item 6 160 90 95

Item 7 1,600 105 115

Item 8 896 80 75

Required -

a. Calculate lower-of-cost-or-net realizable value of Gianni's inventory at December 31, 2020, applying the rule to the individual items.

b. Calculate lower-of-cost-or-net realizable value of Gianni's inventory at December 31, 2020, applying the rule to the inventory classifications.

c. Calculate lower-of-cost-or-net realizable value of Gianni's inventory at December 31, 2020, applying the rule to total inventory.

Reference no: EM132740615

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