Question

Q 6.19: Switzer, Inc. has 8 computers which have been part of the inventory for over two years. Each computer cost $600 and originally retailed for $900. At the statement date, each computer has a current replacement cost of $400. What value should Switzer, Inc., have for the computers at the end of the year

Answer 1

Answer:

The value of computer at the end of year is $3200

Explanation:

Total number of computers = 8

The original cost of computers = $600 per computer.

Original retailed = $900

The replacement cost = $400

Since the replacement cost of the market value is $ 400. Therefore, the value of all computers can be calculated by multiplying the $400 with the number of units.

The value of computer at the end of the year = $400 × 8 = $3200