Oslo Corporation has two products in its ending inventory, each accounted for at

Question

Oslo Corporation has two products in its ending inventory, each accounted for at the lower of cost or market. A profit margin of 30% on selling price is considered normal for each product. Specific data with respect to each product follows: Product #1 Product #2 Historical cost $20.00 $35.00 Replacement cost 22.50 27.00 Estimated cost to dispose 5.00 13.00 Estimated selling price 40.00 65.00 In pricing its ending inventory using the lower-of-cost-or-market, what unit values should Oslo use for products #1 and #2, respectively?

Explanation / Answer

Answer:

$20.00 and $32.50.

Particulars Product 1 Product 2 RC 22.5 27 NRV 40-5=35 65-13=52 NRV-PM 35-(40*0.30)=23 52-(65*0.30)=32.5 Cost 20 35 lower-of-cost-or-market 20 32.5

Related Questions

Navigate

• Browse (All)
• Browse O
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.