Which of the following statements does not accurately describe the effects of a write-down of inventory on December 31, 2014 using the lower of cost or market (LCM) valuation method?
A) The 2013 gross profit decreases.
B) The 2014 cost of goods sold is effectively decreased if the inventory was sold during 2014.
C)The 2013 ending inventory is decreased.
D)The 2014 gross profit is not affected when the inventory was sold during 2014.

Question

Quizplus · Accepted Answer

The 2014 gross profit is not affected when the inventory was sold during 2014 because the write-down is recognized in the current period, not the period of sale.

Which of the Following Statements Does Not Accurately Describe the Effects