Which of the following assets must be reported at the lower-of-cost-and-net-realisable-value?

Question

Quizplus · Accepted Answer

Inventory is the only asset among the given options that must be reported at the lower-of-cost-and-net-realisable-value as per the accounting standards. This is because inventory can become obsolete or have a decline in value due to changes in the market, damage, or spoilage, which could affect its resale value. Therefore, it is important to report inventory at the lower-of-cost-and-net-realisable-value.

Which of the Following Assets Must Be Reported at the Lower-Of-Cost-And-Net-Realisable-Value