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16 August, 12:09

Presented below is information related to Waterway Inc.'s inventory. (per unit) Skis Boots Parkas Historical cost $370.50 $206.70 $103.35 Selling price 413.40 282.75 143.81 Cost to sell 37.05 15.60 4.88 Cost to complete 62.40 56.55 41.44 Determine the following: the net realizable value for each item, and the carrying value of each item under LCNRV.

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  1. 16 August, 12:20
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    (1) $313.95; $313.95

    (2) $210.6; $206.70

    (3) $97.49; $97.49

    Explanation:

    Skis:

    Net realizable value = selling price - cost to sell - cost to complete

    = 413.40 - 37.05 - 62.40

    = $313.95

    Historical cost = $370.50

    LCNRV = lower of historical cost or net realizable value

    = $313.95

    Boots:

    Net realizable value = selling price - cost to sell - cost to complete

    = 282.75 - 15.60 - 56.55

    = $210.6

    Historical cost = $206.70

    LCNRV = lower of historical cost or net realizable value

    = $206.70

    Parkas:

    Net realizable value = selling price - cost to sell - cost to complete

    = 143.81 - 4.88 - 41.44

    = $97.49

    Historical cost = $103.35

    LCNRV = lower of historical cost or net realizable value

    = $97.49
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