Data related to the inventories of Kimzey Medical Supply are presented below:
- In applying the lower of cost or market rule, the inventory of rehab supplies would be valued at:
A) $122.
B) $158.
C) $162.
D) $155.

Question

Data related to the inventories of Kimzey Medical Supply are presented below: 
- In applying the lower of cost or market rule, the inventory of rehab supplies would be valued at:
A) $122. 
B) $158. 
C) $162. 
D) $155.

Quizplus · Accepted Answer

RC = $158.
NRV = $165 ? $10 = $155.
NRV - Normal profit margin = $155 - ($165 × 20%) = $122.
Designated market = NRV - Normal profit margin = $155.
Cost = $162.
Market is lower than cost.

Data Related to the Inventories of Kimzey Medical Supply Are