When the lower of cost or market rule/net realizable value requires an inventory adjustment,the:
A)adjustment usually,but not always,reduces the book value of inventory.
B)write-down is usually reported as a part of cost of goods sold.
C)inventory adjustment is recorded in a contra-account called Inventory Allowances.
D)write-down does not affect any of the financial statements.

Question

Quizplus · Accepted Answer

The entry to record the write-down includes a debit to Cost of Goods Sold and a credit to Inventory.

When the Lower of Cost or Market Rule/net Realizable Value