Which method(s) may be used to record a loss due to a price decline in the value of inventory?
A) The cost-of-goods-sold method.
B) The sales method.
C) The loss method
D) Both the cost-of-goods-sold method and the loss method.

Question

Quizplus · Accepted Answer

The cost-of-goods-sold method and the loss method can both be used to record a loss due to a price decline in the value of inventory. The cost-of-goods-sold method is often used when the inventory is sold, and the loss method is used when the inventory is not sold but its value has declined below its cost. Therefore, both methods are appropriate depending on the circumstances.

Which Method(s) May Be Used to Record a Loss Due