Lower-of-cost-or-net realizable value
A)gives the lowest valuation if applied to the total inventory.
B)gives the lowest valuation if applied to major groups of inventory.
C)gives the lowest valuation if applied to individual items of inventory.
D)must be applied to major groups for taxes.

Question

Quizplus · Accepted Answer

Applying the lower-of-cost-or-net realizable value to individual items of inventory typically results in the lowest valuation because it considers each item's specific circumstances, potentially identifying more items that need to be written down.

Lower-Of-Cost-Or-Net Realizable Value