Solution-Determine the lower of cost and net relizable value

Determine the lower of cost and net relizable value

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Reference no: EM132427956

Question - Pharoah Company uses a perpetual inventory system and the FIFO cost formula for valuing inventory. The company is now in the process of comparing the cost of its inventory with its net realizable value. The following data are available at Pharoah Company's year end, December 31:

	Units	Unit Cost	Net Realizable Value per Unit
Clothing	98	$7	$6
Jewellery	77	20	22
Greeting cards	44	1	2
Stuffed toys	52	11	39

Required -

Determine the lower of cost and net relizable value of the ending inventory Pharoah Company applies LCNRV on individual items.

Prepare the journal entry required, if any, to record the adjustment from cost to net realizable value.

Reference no: EM132427956

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Determine the lower of cost and net relizable value

Reference no: EM132427956

Reference no: EM132427956

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