Boston Tea Company uses the LCNRV method, on an individual-item basis, in pricin

Question

Boston Tea Company uses the LCNRV method, on an individual-item basis, in pricing inventory items. The inventory at December 31, 2017, consists of products A, B, D, F, G, and H. Relevant per unit data for these products are provided below. 3. Estimated selling price $ 120 110 95 $ 90 110 90 50 80 30 80 25 80 35 20 30 20 30 30 Cost to complete Selling costs Required: Using the LCNRV rule, determine the proper unit value for balance sheet reporting purposes at December 31, 2017, for each of the inventory items above

Explanation / Answer

LCNRV is lower of cost or net realisable value.

NRV = Estimated Selling Price - (Cost to complete+Selling cost)

A B D F G H NRV item wise 80 62 60 35 70 40 Cost 75 80 80 80 50 36

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