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The inventory of the Bateman Upholstering Corp. on December 31 consisted of the following items:
| Unit | ||||
| Quantity | Cost | Market | ||
| Frames | ||||
| Type F-1 | 110 | $14.25 | $15.50 | |
| Type F-12 | 75 | 26.00 | 22.50 | |
| Type F-15 | 60 | 21.50 | 21.00 | |
| Springs (sets) | ||||
| Type S-1 | 760 | 7.28 | 8.50 | |
| Type S-12 | 625 | 10.50 | 11.50 | |
| Type S-15 | 340 | 8.60 | 6.00 | |
Required:
- Calculate the ending inventory at the lower of cost and net realizable value, applied
- to each item
- to each category
- to the entire inventory.
- What is the effect of each application of LCNRV on the gross profit in the current year? in the following year?
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