Problem 9 (Measurement - LCNRV, Item by Item with existing allowance)Hershey's Ice Cream Factory sells a variety of flavors, which includes strawberry, mango, chocolate and durian to itscustomers. At December 31, 2021, the balance of the entity's ending inventory account was P5,000,000, and the"allowance for inventory write down" account before any adjustment was P200,000.Relevant information about the proper valuation of inventories and the breakdown of inventory cost and market dataat December 31, 2021, are as follows:NetRealizableReplacementCostCostSales PriceNormalProfitValue1,000,0001,100,0001,450,000700,000100,000StrawberryMangoChocolate1,500,0001,200,0001,750,000 1,600,000200,0001,700,0001,300,0002,000,000 1,450,000250,000Durian800,0001,000,0001,300,000950,000250,000Total5,000,0004,600,0006,500,000 4,700,000800,0001.2.How much should be the inventory to be reported in the year-end statement of financial position?How much is the loss on inventory writedown to be included in entity's 2021 cost of sales?3. Prepare the journal entry to record the loss on inventory write-down.

Name: Problem 9 (Measurement - LCNRV, Item by Item with existing allowance)
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Description: Problem 9 (Measurement - LCNRV, Item by Item with existing allowance)Hershey's Ice Cream Factory sells a variety of flavors, which includes strawberry, mango, chocolate and durian to itscustomers. At December 31, 2021, the balance of the entity's en

Inventory must be recorded at a lower of cost or the net realizable value. Under LCNRV, we…

Business

Accounting

1. How much should be the inventory to be reported in the year-end statement of financial position? 2. How much is the loss on inventory writedown to be included in entity's 2021 cost of sales? 3. Prepare the journal entry to record the loss on inventory write-down.

1. How much should be the inventory to be reported in the year-end statement of financial position? 2. How much is the loss on inventory writedown to be included in entity's 2021 cost of sales? 3. Prepare the journal entry to record the loss on inventory write-down.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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