The Following Inventory Information Was Taken from the Records of Kleinfeld

question 14

Multiple Choice

The following inventory information was taken from the records of Kleinfeld Inc.: $\begin{array}{ll}\text { Historical cost } & \$ 12,000 \\\text { Replacement cost } & \$ 7,000 \\\text { Expected selling price } & \$ 9,000 \\\text { Expected selling cost } & \$ 500 \\\text { Normal profit margin } & 50 \% \text { of price }\end{array}$
-Under IAS 2, what should the balance sheet report for Inventory?

• A)$7,000
• B)$8,500
• C)$7,600
• D)$9,000

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Definitions:

Interest Days

The number of days over which interest is calculated on a loan or financial instrument.

Coupon Bond

A type of bond that pays the holder interest at a fixed rate, typically semi-annually, until maturity when the face value is repaid.

Ask Price

The lowest price at which a seller is willing to sell a financial asset, commodity, or currency in the market at a particular time.

Accrued Interest

Accrued interest is the interest that has been earned but not yet received or paid, accumulating on bonds and loans from one payment period to the next.