Inventories are reported on the balance sheet at
A)current market value.
B)historical cost.
C)net realizable value.
D)the lower of cost or market.

Question

Quizplus · Accepted Answer

Inventories are generally reported on the balance sheet at the lower of cost or market value. This means that they are recorded at their historical cost or original purchase cost, but if the market value of the inventory falls below this amount, then the inventory must be written down to reflect this lower value. This conservative approach ensures that inventories are not overstated on the balance sheet and provides a more accurate portrayal of a company's financial condition.

Inventories Are Reported on the Balance Sheet at