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The appropriate cost per unit of inventory is 



1.	Lenny- Llamas purchased 1,000 llamas on January 1, 2011. These llamas will be sheared semiannually and their wool sold to specialty clothing manufacturers. The llamas were purchased for $222,000. During 2011 the change in fair value due to growth and price changes is $14,100, the wool harvested but not yet sold is valued at net realizable value of $27,000, and the change in fair value due to harvest is ($1,750). On Lenny- Llamas income statement for the year ending December 31, 2011, what amount of unrealized gain on biological assets will be reported?
a.	$39,350
b.	$41,100
c.	$14,100
d.	$12,350

2.	Turner Corporation acquired two inventory items at a lump-sum cost of $50,000. The acquisition included 3,000 units of product LF, and 7,000 units of product 1B. LF normally sells for $15 per unit, and 1B for $5 per unit. If Turner sells 1,000 units of LF, what amount of gross profit should it recognize?
a.	$1,875
b.	$5,625.
c.	$10,000.
d.	$11,875.

	3.	Robertson Corporation acquired two inventory items at a lump-sum cost of $40,000. The acquisition included 3,000 units of product CF, and 7,000 units of product 3B. CF normally sells for $12 per unit, and 3B for $4 per unit. If Robertson sells 1,000 units of CF, what amount of gross profit should it recognize?
a.	$1,500.
b.	$4,500.
c.	$8,000.
d.	$9,500.

	4.	At a lump-sum cost of $48,000, Pratt Company recently purchased the following items for resale:
Item	No. of Items Purchased	Resale Price Per Unit
	M	4,000	$2.50
	N	2,000	8.00
	O	6,000	4.00
The appropriate cost per unit of inventory is :
		M	N	O
	a.	$2.50	$8.00	$4.00
	b.	$2.07	$13.24	$2.21
	c.	$2.40	$7.68	$3.84
	d.	$4.00	$4.00	$4.00

	5.	Confectioners, a chain of candy stores, purchases its candy in bulk from its suppliers. For a recent shipment, the company paid $3,000 and received 8,500 pieces of candy that are allocated among three groups. Group 1 consists of 2,500 pieces that are expected to sell for $0.25 each. Group 2 consists of 5,500 pieces that are expected to sell for 0.60 each. Group 3 consists of 500 pieces that are expected to sell for $1.20 each. Using the relative sales value method, what is the cost per item in group 1?
a.	$0.250.
b.	$0.166.
c.	$0.200.
d.	$.0375.




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