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Chapter 9 HomeworkInventories: Additional Issues1.Herman Company has three products in its ending inventory. Specific per unit data for each ofthe products are as follows:Product 1Product 2Product 3Cost$35$105$ 65Replacement cost3313055Selling price85165115Disposal costs87025Normal profit margin76027What unit values should Herman use for each of its products when applying the LCM rule toending inventory?
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2.The inventory of Royal Decking consisted of five products. Information about the December 31,2013, inventory is as follows:Per UnitProductCostReplacement CostSelling PriceA$220$125$240B260160280C140155260D180150320E130155160Disposal costs consist only of a sales commission equal to 10% of selling price and shipping costsequal to 10% of cost. The normal gross profit percentage is 30% of selling price.What unit value should Royal Decking use for each of its products when applying the LCM rule tounits of inventory?