Question - Loft Co. reviewed its inventory values for proper pricing at year-end. The following summarizes two inventory items examined for the lower of cost or market:
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Inventory item #1
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Inventory item #2
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Original cost
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$210,000
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$400,000
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Replacement cost
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$150,000
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$370,000
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|
Net realizable value
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$240,000
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$410,000
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Net realizable value less profit margin
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$208,000
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$405,000
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What amount should Loft include in inventory at year-end, if it uses the total of the inventory to apply the lower of cost or market?
$613,000
$520,000
$650,000
$610,000