When inventories are written down due to the application of the lower of cost or market LCM) rule, the account that is usually increased is

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When inventories are written down due to the application of the lower of cost or market (LCM) rule, the account that is usually increased is Loss on Decline in Inventory Value. This reflects the decrease in the value of the inventory and the loss incurred by the company due to the decline in market value. It is important to note that this is not the same as Cost of Goods Sold, which is a separate expense account used to record the cost of goods that were actually sold during a period of time. Inventories and Accumulated Depreciation-Inventory are not affected by the LCM rule.

When Inventories Are Written Down Due to the Application of the Lower