A company has inventory with a sales value of $34,000,current market value of $22,000 and a total cost of $23,400.Since the sales value exceeds both cost and market,no write down in inventory value is required.

Question

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According to the lower of cost or market rule, inventory should be recorded at the lower of its cost or market value. Since the market value ($22,000) is lower than the cost ($23,400), a write-down is required.

A Company Has Inventory with a Sales Value of $34,000,current