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Tatum Company has four products in its inventory. Information about the December 31, 2011, inventory is as follows:The normal gross profit percentage is 25% of cost.
Required:
1. Determine the balance sheet inventory carrying value at December 31, 2011, assuming the LCM rule is applied to individual products.
2. Assuming that Tatum recognizes an inventory write-down as a separate income statement item, determine the amount of the loss.
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