Carlsberg Corporation Has 2,000 Units of Product#1and 4,000 Units of Product#2

question 238

Multiple Choice

Carlsberg Corporation has 2,000 units of product#1and 4,000 units of product#2 in its inventory at December 31, 2014. Specific data with respect to each product follows: What amount will be reported on the company statement of financial position at December 31, 2014 for ending inventory using lower-of-cost-or-net realizable value?

• A) CHF220,000.
• B) CHF288,000.
• C) CHF296,000.
• D) CHF306,000.

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Definitions:

Gross Method

An accounting practice where purchases are recorded at their full invoice amount without deducting any purchase discounts.

Periodic Method

An accounting approach used to value inventory and determine the cost of goods sold in which physical counts are done periodically, typically at the end of an accounting period.

Gross Method

An accounting method used to record purchases at the full invoice amount without deducting any cash discounts.

Defective Merchandise

Goods that are damaged or below quality standards, often leading to returns, exchanges, or adjustments in sales and accounting records.