If the cost of an item of inventory is $70,the current replacement cost is $65,and the sales price is $85,the amount included in inventory according to the lower of cost or market is
A)$65.
B)$70.
C)$85.
D)$160.

Question

Quizplus · Accepted Answer

According to the lower of cost or market rule, inventory should be recorded at the lower of its cost ($70) or its market value (current replacement cost, $65). Therefore, the amount included in inventory is $65.

If the Cost of an Item of Inventory Is $70,the