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13 December, 19:31

Given the acquisition cost of product z is $30, the net realizable value for product z is $27, the normal profit for product z is $1, and the market value (replacement cost) for product z is $24, what is the proper per unit inventory value for product z applying lcm?

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  1. 13 December, 19:52
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    Lcm requires to value inventory at the lower of acquisition cost or net realizable value.

    Net realizable value = $27 - $1 = $26

    Cost = $30

    Therefore, it would be valued at $26
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