Current generally accepted accounting principles state that a departure from the cost basis of pricing inventory is required when the utility of the goods is no longer as great as its cost.Accordingly,the lower-of-cost-or-market rule is applied to inventories such that,if market is less than cost,an adjustment is made to record the loss and to restate ending inventory at the lower value.
What effect would the failure to apply the lower-of-cost-or-market method have on the income statement in current and future periods?

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The Answer of Current generally accepted accounting principles state that a departure from the cost basis of pricing inventory is required when the utility of the goods is no longer as great as its cost.Accordingly,the lower-of-cost-or-market rule is applied to inventories such that,if market is less than cost,an adjustment is made to record the loss and to restate ending inventory at the lower value.
What effect would the failure to apply the lower-of-cost-or-market method have on the income statement in current and future periods?

Current Generally Accepted Accounting Principles State That a Departure from the Cost