Which of the following is not an acceptable method of applying the lower-of-cost-or-net realizable value method to inventory?
A) Inventory location.
B) Groups of inventory items.
C) Individual item.
D) Total of the inventory.

Question

Quizplus · Accepted Answer

Applying the lower-of-cost-or-net realizable value method by inventory location is not an acceptable method. This method would require assuming that all items in the same location have the same cost and net realizable value, which may not be accurate for individual items within a location. Groups of inventory items, individual items, or the total inventory can be acceptable methods for applying the lower-of-cost-or-net realizable value method.

Which of the Following Is Not an Acceptable Method of Applying