Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. teel distribution co. has determined its december

Teel Distribution Co. has determined its December 31, 2007 inventory on a FIFO basis at...

80.2K

Verified Solution

Question

Accounting

Teel Distribution Co. has determined its December 31, 2007 inventory on a FIFO basis at $250,000. Information pertaining to that inventory follows:

Estimated selling price $255,000

Estimated cost of disposal/completion 10,000

Normal profit margin 30,000

Current replacement cost 225,000

Teel records losses that result from applying the lower-of-cost-or-market rule. At December 31, 2007, the loss that Teel should recognize is

a. $0. b. $5,000. c. $20,000. d. $25,000.

Answer key says is is B, but I keep getting D. Please help to explain.

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Q

Write 5+ pages in one of the following topics :- ( MAKE SURE THE HANDWRITING IS...

Civil Engineering
Q

x2uxx --2xyuxy -- 3y2uyy = 0 u(x,1) = x, uy(x,1) = 1

Advance Math
Q

Two thin cylindrical pipes of equal internal diameters made of aluminium and plastic are taken...

Physics
Q

26 Solve for x in the right triangle below 12 O 12 O 10 O...

Geometry
Q

5 309 4 glog 2 wreu keyter what is the result of the transaction

Calculus
Q

12. State, with reasons, whether the following statements are true or false? (1) XYZ Private...

Accounting
Q

Cost allocation is a general term that refers to identifying accumulated costs with, or tracing...

Accounting
Q

retained earnings is increased by each of the following except a.net income b.some disposals of...

Accounting
Q

ANSWER ALL A-E 2) Teecorp Company provides the following ABC costing information: The above...

Accounting
Q

Q3. Mohammed Garment Industry workers produce, or repair clothing made from cloth. The three basic...

Accounting
Q

please provide me with explanation which cells we use to solve each question ...

Accounting
Q

A $1,000 par value bond was issued 25 years ago at a 12 percent coupon...

Finance