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Moore Company purchased an item for inventory that cost $20 per unit and was priced to sell at $30. It was determined that the replacement cost is $18 per unit. Using the lower of cost or market rule, what amount should be reported on the balance sheet for for each unit in inventory.

Respuesta :

The amount that should be reported on the balance sheet for each unit in inventory is $18.

Calculation of the amount reported:

Since

Cost of inventory to purchased an item = $20

The selling price of an item = $30

Replacement cost = $18

Based on the above information, the amount that should be reported on the balance sheet is the cost of inventory or market value which ever is lower.

As we can see that the replacement cost is less than the cost of inventory so the same is to be reported.

Therefore we ignored the selling price of an item.

Learn more about an inventory here: https://brainly.com/question/22654785

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