The use of the lower of cost or market method to value inventory for reporting purposes is a departure from the accounting principle of
A)going concern.
B)conservatism.
C)matching.
D)historical cost.

Question

Quizplus · Accepted Answer

The lower of cost or market method is a departure from the historical cost principle, which states that assets should be recorded at their cost at the time of acquisition. This method allows for the valuation of inventory at the lower of its original cost or its current market value, reflecting a more conservative estimate of value when market prices have declined.

The Use of the Lower of Cost or Market Method