Berry Inc. has 6 computers which have been part of the inventory for over two years. Each computer cost $600 and originally retailed for $900. At the statement date each computer has a current replacement cost of $450. What value should Berry Inc. have for the computers at the end of the year?
A) $1800.
B) $2700.
C) $3600.
D) $5400.

Question

Quizplus · Accepted Answer

The original cost of each computer was $600, so the cost of all 6 computers is 6 x $600 = $3600. However, since the current replacement cost of each computer is $450, the total value of the inventory is 6 x $450 = $2700. Therefore, the value that Berry Inc. should have for the computers at the end of the year is $2700.

Berry Inc Has 6 Computers Which Have Been Part of the the Inventory