Inventory should be valued using the lower-of-cost-or-market rule.

Name: Inventory should be valued using the lower-of-cost-or-market rule.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

This is a generally accepted accounting principle that states that inventory should be valued at the lower of its cost or its net realizable value (market value). This is to ensure that inventory is not overstated on the balance sheet and to account for any declines in market value that may occur.

Inventory Should Be Valued Using the Lower-Of-Cost-Or-Market Rule