Using the Lower-Of-Cost-Or-Market Method of Inventory Valuation, What Should the Total

question 63

Essay

Using the lower-of-cost-or-market method of inventory valuation, what should the total inventory value be for the following items: $$\begin{array} { | c | r | l | l | l | l | } \hline \text { Item } & \begin{array} { l } \text { Inventory } \\\text { Quantity }\end{array} & \begin{array} { l } \text { Unit cost } \\\text { price }\end{array} & \begin{array} { l } \text { Unit market } \\\text { price }\end{array} & \begin{array} { l } \text { Total cost } \\\text { price }\end{array} & \begin{array} { l } \text { Total market } \\\text { price }\end{array} \\\hline \text { A } & 200 & \$ 5 & \$ 4.50 & \$ 1,000 & \$ 900 \\\hline \mathrm { B } & 100 & 4 & 5.00 & 400 & 500 \\\hline \mathrm { C } & 50 & 7 & 6.50 & 350 & 325 \\\hline\end{array}$$

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Definitions:

HR Supply

The available pool of candidates that an organization's human resources department can draw upon to fill positions.

Demand Requirements

The specific needs or conditions that must be met for a service, product, or project, often detailing quantities, specifications, and timing.

External Environmental Supply

The provision of resources or inputs to an organization from its external environment, which can include materials, information, or energy.

Organizational Demand

The requirements or needs of an organization that dictate its operational, personnel, and resource requirements.