Data related to the inventories of Costco Medical Supply is presented below:
(surgical equipment, surgical supplies, rehab equipment, rehab supplies)
selling price: (260, 120, 340, 165)
cost: (170, 90, 250, 162)
replacement cost: (240, 80, 235,158)
disposal cost: (30, 5, 25, 10)
normal gross profit ratio: (30%, 30%, 30%, 20%)
In applying the LCM rule, the inventory of rehab equipment would be valued at:
A. $315.
B. $247.
C. $150.
D. $235.
Answer: D. $235.
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