When the value of inventory falls below its cost,companies have the option of recording the inventory at cost or the lower market value.

Name: When the value of inventory falls below its cost,companies have the option of recording the inventory at cost or the lower market value.
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Companies are required to record inventory at the lower of cost or market value, not as an option. This is in accordance with the lower of cost or market (LCM) rule in accounting.

When the Value of Inventory Falls Below Its Cost,companies Have