Iris Company has provided the following information regarding two of its items of inventory at year-end:
There are 100 units of Item A having a cost of $20 per unit and a replacement cost of $18 per unit.
There are 50 units of Item B having a cost of $50 per unit and a replacement cost of $55 per unit.
How much is the ending inventory using lower of cost or market on an item-by-item basis?
A)$4,300
B)$4,500
C)$4,750
D)$4,550

Question

Iris Company has provided the following information regarding two of its items of inventory at year-end:
 There are 100 units of Item A having a cost of $20 per unit and a replacement cost of $18 per unit.
 There are 50 units of Item B having a cost of $50 per unit and a replacement cost of $55 per unit.
How much is the ending inventory using lower of cost or market on an item-by-item basis?
A)$4,300
B)$4,500
C)$4,750
D)$4,550

Quizplus · Accepted Answer

Ending inventory ($4,300) = (100 * $18) + (50 * $50)

Iris Company Has Provided the Following Information Regarding Two of Its