Question

An inventory loss from a permanent market decline of $360,000 occurred in May Year 1. Cox Co. appropriately recorded this loss in May Year 1 after its March 31, Year 1, quarterly report was issued.

1. What amount of inventory loss should be reported in Cox's quarterly income statement for the three months ended June 30?

Answer 1

$360,000

Step-by-step explanation:

Data provided in the question:

An inventory loss from a permanent market decline of $360,000 occurred in May Year 1

Now,

The inventory loss from a permanent market decline are recognized in the interim period.

Therefore,

The amount $360,000 which is the inventory loss from a permanent market decline will be recognized in the quarter interim period.

Hence,

The answer is $360,000