The Factor That Could Cause the Net Realisable Value of an Item

question 30

Multiple Choice

The factor that could cause the net realisable value of an item of inventory to be lower than its cost is:

• A) the goods were originally purchased at too low a price.
• B) a rise in the market price of the item.
• C) the inventory item has become obsolete.
• D) all of the above.

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Definitions:

Backcountry

In colonial America, the area stretching from central Pennsylvania southward through the Shenandoah Valley of Virginia and into upland North and South Carolina.

Market Economy

An economic system where decisions regarding investment, production, and distribution are based on supply and demand, and prices of goods and services are determined in a free price system.

Plantation Mistresses

Women who lived on and managed plantations in the southern United States during the antebellum period, often overseeing domestic aspects of plantation life.

Domestic Servants

Workers employed within the household, performing various chores and tasks such as cooking, cleaning, and childcare.