What is the appropriate treatment in an interim financial report for inventory with a net realizable value below cost?
A) The loss should always be recorded in the interim period in which net realizable value drops below cost.
B) The loss should be recorded in the interim period in which net realizable value drops below cost if the loss is considered temporary.
C) The loss should be recorded in the interim period in which net realizable value drops below cost if the loss is considered permanent.
D) The loss should be ignored for interim reporting purposes.
E) There is no loss to report.

Question

Quizplus · Accepted Answer

The loss should be recorded in the interim period in which net realizable value drops below cost if the loss is considered permanent.

What Is the Appropriate Treatment in an Interim Financial Report