Chapter 09 - Homework Solutions

Chapter 09 - Homework Solutions - 9-1CHAPTER 9 Inventories...

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Unformatted text preview: 9-1CHAPTER 9 Inventories: Additional Valuation Issues SOLUTIONS TO BRIEF EXERCISES BRIEF EXERCISE 9-1 (a) Ceiling $198.00 ($217 – $19) Floor $166.00 ($217 – $19 – $32) (b) $106.00 (c) $51.00 BRIEF EXERCISE 9-2 Item Cost Designated Market LCM Jokers $2,000 $1,900 $1,900 Penguins 5,000 4,950 4,950 Riddlers 4,400 4,550 4,400 Scarecrows 3,200 3,070 3,070 9-2SOLUTIONS TO EXERCISES EXERCISE 9-1 (15–20 minutes) Per Unit Lower of Part No. Quantity Cost MarketTotal Cost Total Market Cost or Market 110 600 $ 90 $100.00$ 54,000$ 60,000 $ 54,000 111 1,000 60 52.0060,00052,000 52,000 112 500 80 76.0040,00038,000 38,000 113 200 170 180.0034,00036,000 34,000 120 400 205 208.0082,00083,200 82,000 121 1,600 16 0.2025,600 320 320 122 300 240 235.0072,00070,50070,500Totals $367,600$340,020$330,820(a) $330,820. (b) $340,020. EXERCISE 9-2 (10–15 minutes) Item Net Realizable Value (Ceiling) Net Realizable Value Less Normal Profit (Floor) Replacement Cost Designated Market CostLCMD $90* $70** $120 $90 $75 $75 E 80 60 72 72 80 72 F 65 45 70 65 80 65 G 65 45 30 45 80 45 H 80 60 70 70 50 50 I 60 40 30 40 36 36 *Estimated selling price – Estimated selling expense = $120 – $30 = $90. **Net realizable value – Normal profit margin = $90 – $20 = $70. 9-3EXERCISE 9-7 (15–20 minutes) Cost Per Lot (Cost Allocated/ No. of Lots) $2,100 2,800 1,680 Cost Allocated to Lots $18,900 42,000 28,560$89,460Total Cost $89,460 89,460 89,460 X X X Relative Sales Price $27,000/$127,800 $60,000/$127,800 $40,800/$127,800 $80,000 56,00024,000 18,200$ 5,800Gross Profit $ 3,600 9,600 10,800$24,000Total Sales Price $ 27,000 60,000 40,800$127,800Sales $12,000 32,000 36,000$80,000Sales Price Per Lot $3,000 4,000 2,400 Cost Cost of...
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Chapter 09 - Homework Solutions - 9-1CHAPTER 9 Inventories...

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