Can anyone help with this problem? And show how you got your answer? Thanks! Lyn

Question

Can anyone help with this problem? And show how you got your answer? Thanks!
Lynn 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 Replacement cost Estimated cost to dispose....5 18.0027.00 5.00... 13.00 In pricing its ending inventory using the lower of cost or market, what unit values should Lynn use for products #1 and #2, respectively as the designated market

Explanation / Answer

value of inventory is the lower of cost or net realisable value.

Net realisable value =Estimated selling price - estimated cost to dispose.

Market value of product 1 = 35-5 =30

Market value of product 2 = 60-13 =47.

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