Using separate costing methods to calculate the value of Vita Rite's ending inventory
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On December 29, the FDA announced that these vitamins from Vita-Rite Vitamin Co. caused heart palpitations in users age 40-55. As a result of this announcement, the net realizable value of the product dropped 20%.
Using the lower of cost or market, show the value of the company's ending inventory.
What is the range between the three costing methods?
What is the journal entry to record this event? And
how is it handled in the financial statements?
USING THESE NUMBERS
FIFO = 81545
LIFO = 80640
AVERAGE COST METHOD= 81163.
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Solution Summary
The solution uses different costing methods to write a journal entry to calculate the value of Vita Rite Vitamin's ending inventory.
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