Specific identifiation inventory costing method

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Reference no: EM13155181

Happlia Co. impors hoseholds appliances. Each model has many variations and each unit has an identiication number. Happlia pays all cost fr getting the goods from the port to its control warehouse in Des Moines. After repacking, the goods are consigned to retailers. A retailers maks a sale, simultaneously buys the appliance from Happlia, and pays the balance due within one week.

To alleviate the overstocing of refrigertors at a Minneapolis retailer, some were reshipped to a Kansas City retailer where they were still held in inventory at Decmber 31,2009. Happlia paid the cost of this reshipment. Happlia use the specific identification inventory costing method.

Required:

1. In regard to the specific identifiation inventory costing method

a. describe its key elements
b. discuss why it is appropriate for Happlia to use this method

2

a. what general criteria should Happlia use to determine nventory carrying amounts at December 31, 2009?
b. give four example of cost included in these inventory carrying amounts.

3. what costs should e eported in Happlia's 2009 income statement? Ignore the lower of cost or market consideration.

Reference no: EM13155181

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