Prepare journal entries to apply lower-of-cost-or-nrv

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Reference no: EM132791228

The company began its operation in 20X1. At the end of 20X1, the cost of inventory was $150,000 while its NRV was $120,000. At the end of 20X2, the cost of inventory was $130,000, while its NRV was $110,000.

Required :

Problem 1: Prepare journal entries to apply lower-of-cost-or-NRV valuation at the end of 20X1 and 20X2 (using the indirect (allowance) method).

Reference no: EM132791228

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