Almaden hardware store sells two product categories, tools and paint products. information pertaining to its 2021 year-end inventory is as follows:
inventory, by quantity per unit cost net realizable value
product category
tools:
hammers 100 $ 4.50 $ 5.00
saws 150 9.50 8.50
screwdrivers 250 1.50 2.10
paint products:
1-gallon cans 450 5.50 4.50
paint brushes 100 3.50 4.00
required:
1. determine the carrying value of inventory at year-end, assuming the lower of cost or net realizable value (lcnrv) rule is applied to (a) individual products, (b) product categories, and (c) total inventory.
2. assuming inventory write-downs are common for almaden, record any necessary year-end adjustment amount for each of the lcnrv applications in requirement 1.