Using the information below for Morrie Majors Sports store, calculate the amount of inventory adjustment using the lower-of-cost-or-net realizable value method applied to the inventory on a major category basis:

Question

Quizplus · Accepted Answer

Football items:
Cost: (20 × $120) + (10 × $200) + (30 × $80) = $6,800
NRV: (20 × $100) + (10 × $80) + (30 × $100) = $5,800
Lowest is NRV.
Baseball items:
Cost: (40 × $40) + (50 × $160) = $9,600
NRV: (40 × $60) + (50 × $100) = $7,400
Lowest is NRV.
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Using the Information Below for Morrie Majors Sports Store, Calculate