If the merchandise inventory's market value is greater than its cost, then it must be adjusted for the difference in amount.

Question

Quizplus · Accepted Answer

If the market value of merchandise inventory is greater than its cost, there is no need for adjustment. It is beneficial for the company as it indicates potential profits. However, if the market value is less than the cost, then the inventory needs to be adjusted to its lower market value.

If the Merchandise Inventory's Market Value Is Greater Than Its