Which of the following is a CORRECT statement about the lower-of-cost-or market rule when applied to inventories?

Question

Quizplus · Accepted Answer

Under IFRS, some lower-of-cost-or-market write-downs may be reversed if certain conditions are met. However, under U.S. GAAP, once inventory has been written down to market value, the write-down cannot be reversed in future periods. So, option A is incorrect. Option B is also incorrect as the lower-of-cost-or-market rule is mandatory under both U.S. GAAP and IFRS. Currently, the lower-of-cost-or-market rules are not exactly the same under both standards. Therefore, option C is also incorrect.

Which of the Following Is a CORRECT Statement About the Lower-Of-Cost-Or