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Question - LGM Ltd has 200 items of a product Zeros in inventory at 31 March 2021. The items were found to be damaged. The items can be repaired and repackaged for a cost of £1.00 per item. Once repackaged, the items can be sold at the normal price of £3.00 each. The original cost of the items was £1.90 each. The replacement cost at 31 March 2021 is £2.25 each.
What value should LGM put in inventory of Zeros in its statement of financial position at 31 March 2021?
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