Use the lower-of-cost-or-market rule to determine the value of the following inventory for Instant Key's. $$\begin{array} { l l l l l l }
\text { ITEM } & \text { QTY } & \text { COST } & \text { MKT } & \text { BASIS } & \text { AMOUNT } \
\hline \text { Door Keys } & 154 & \$ 554 & \$ 598 & & \
\text { Car Keys } & 133 & 164 & 210 & \
\text { Bike Keys } & 257 & 510 & 620 & \
\text { Safe Keys } & 491 & 279 & 240 &
\end{array}$$ Total value in Inventory is:
A) $85,316
B) $232,156
C) $431,595
D) $356,038

Question

Use the lower-of-cost-or-market rule to determine the value of the following inventory for Instant Key's. $$\begin{array} { l l l l l l } 
\text { ITEM } & \text { QTY } & \text { COST } & \text { MKT } & \text { BASIS } & \text { AMOUNT } \
\hline \text { Door Keys } & 154 & \$ 554 & \$ 598 & & \
\text { Car Keys } & 133 & 164 & 210 & \
\text { Bike Keys } & 257 & 510 & 620 & \
\text { Safe Keys } & 491 & 279 & 240 &
\end{array}$$ Total value in Inventory is:
A) $85,316
B) $232,156
C) $431,595
D) $356,038

Quizplus · Accepted Answer

The lower-of-cost-or-market rule requires valuing inventory at the lower of its cost or market value. For each item, compare the cost and market value, and use the lower value for inventory valuation. Calculate the total as follows:  - Door Keys: 154 * $554 = $85,316 (Cost is lower)  - Car Keys: 133 * $164 = $21,812 (Cost is lower)  - Bike Keys: 257 * $510 = $131,070 (Cost is lower)  - Safe Keys: 491 * $240 = $117,840 (Market is lower)  Total = $85,316 + $21,812 + $131,070 + $117,840 = $356,038.

Use the Lower-Of-Cost-Or-Market Rule to Determine the Value of the Following