A loss in inventory value caused by application of the lower of cost or market (LCM) rule is recorded in a "Loss from Impairment" account.

Question

Quizplus · Accepted Answer

The loss from applying the lower of cost or market rule is typically recorded in a "Loss on Inventory Write-Down" account or directly reduces the value of the inventory on the balance sheet, not in a "Loss from Impairment" account, which is more commonly associated with long-term assets.

A Loss in Inventory Value Caused by Application of the Lower