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Computing Lower of Cost or Market

On the basis of the following data, determine the value of the inventory at the lower of cost or market. Assemble the data in the form illustrated in Exhibit 9 of Survey of Accounting by Carl S. Warren.

Commodity Inventory Quantity Unit Cost Price Unit Market Price
Aquarius 20 $80 $92
Capricorn 50 70 65
Leo 8 300 280
Scorpio 30 40 30
Taurus 100 90 94

Solution Summary

This solution illustrates how to compute the lower of cost or market value on inventory under different conditions.