Picton Co Prepares Its Estimate of LCM Using the Net Realizable

question 132

Multiple Choice

Picton Co. prepares its estimate of LCM using the net realizable value. Inventory item X570 cost $45 and the item is currently selling in the market for $55 and selling costs are estimated to be $6. Picton expects to earn a profit of $4 on the sale of this item. In its year-end financial statements, Picton Co. should value this item at:

• A) $49
• B) $55
• C) $45
• D) $50

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Definitions:

Development of Cities

The process by which towns and cities are formed and become larger as more and more people begin living and working in central areas.

Demography

The statistical study of human populations, including their size, growth, density, distribution, and vital statistics.

Study

The act of applying one's mind to acquiring knowledge on a particular subject through reading, research, or practice.

Urban Development

The process of improving and expanding facilities, housing, and infrastructure in urban areas to enhance the quality of life for its inhabitants.