Farmington Company uses a perpetual inventory system and values its inventory at lower of cost or market. Its accounting records indicate the following information relating to inventory: Prepare the required journal entries at December 31, 2017, and December 31, 2018, to record the inventory at lower of cost or market using the following methods:
a. Direct method
b. Allowance method

Question

Farmington Company uses a perpetual inventory system and values its inventory at lower of cost or market. Its accounting records indicate the following information relating to inventory:  Prepare the required journal entries at December 31, 2017, and December 31, 2018, to record the inventory at lower of cost or market using the following methods: 
a. Direct method
b. Allowance method

Quizplus · Accepted Answer

The Answer of Farmington Company uses a perpetual inventory system and values its inventory at lower of cost or market. Its accounting records indicate the following information relating to inventory:  Prepare the required journal entries at December 31, 2017, and December 31, 2018, to record the inventory at lower of cost or market using the following methods: 
a. Direct method
b. Allowance method

Farmington Company Uses a Perpetual Inventory System and Values Its