Which of the following is NOT a reason why inventory costs are recorded as expenses when sold rather than when incurred?

Question

Quizplus · Accepted Answer

Inventory costs are recorded as expenses when sold rather than when incurred to achieve a better matching of expenses with related revenues, give users of the company's financial statements a clearer picture of profitability, and because inventory is considered an asset at the time it is acquired. The timing of recording inventory transactions does not affect the amount of inventory costs that need to be recorded as expenses eventually, but it does affect the timing of those expenses in the financial statements. Therefore, recording inventory costs as expenses when sold rather than when incurred helps ensure that expenses are recognized in the appropriate period, regardless of when the transaction is recorded. It does not give accounting personnel more time to record inventory transactions, as inventory must be tracked and recorded on an ongoing basis regardless of when the costs associated with it are recognized as expenses.

Which of the Following Is NOT a Reason Why Inventory