The lower of cost and net realizable value basis of valuing inventories ensures that inventories are
A) not undervalued.
B) valued at their current cost.
C) monitored on an ongoing basis as to their value relative to their cost.
D) valued at their selling price.

Question

Quizplus · Accepted Answer

This method ensures that inventories are not overvalued by requiring regular assessment of their net realizable value compared to their cost.

The Lower of Cost and Net Realizable Value Basis of Valuing