Twenty Units of Inventory on Hand at the End of the Year

question 116

Multiple Choice

Twenty units of inventory on hand at the end of the year are recorded at their cost of $5.00 per unit using FIFO. Current net realisable value is $4.50 per unit. What amount would be reported as inventory on the balance sheet?

• A)$100.00
• B)$4.50
• C)$90.00
• D)$5.00

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Definitions:

Keynes

John Maynard Keynes was a British economist whose ideas, known as Keynesian economics, had a major impact on modern economic and political theory and on fiscal policies of governments.

Demand

The desire and ability of consumers to purchase goods or services at a given price.

Unemployment

The state of being without a job despite actively looking for work, used as an indicator of the health of the economy.

Saving Equals Investment

A macroeconomic identity where all saved money within the economy is assumed to equal all invested money, indicating a balance in the financial system.