Ask Question
25 January, 20:15

At the end of the year, inventory has a cost of $200,000 and a net realizable value of $195,000 due to normal business circumstances. Prepare the year-end adjusting entry, if any, for inventory using the lower of cost or net realizable value approach. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

+1
Answers (1)
  1. 25 January, 20:29
    0
    The answer is given below;

    Explanation:

    The adjusting entry will be;

    Income Statement Dr.$5,000

    Inventory Cr.$5,000

    As the NRV is less than cost, therefore difference amount will be charged to profit and loss account.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “At the end of the year, inventory has a cost of $200,000 and a net realizable value of $195,000 due to normal business circumstances. ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers