Inventories Are to Be Measured at the Lower of Cost

question 8

Multiple Choice

Inventories are to be measured at the lower of cost or net realisable value. Net realisable value is defined in AASB 102/IAS 2 Inventories as:

• A) the fair value of the inventories at purchase date.
• B) the amount paid for the purchase of the inventories in an arm's length transaction.
• C) the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale.
• D) the estimated buying price in the ordinary course of business.

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Definitions:

Structural Theory

A theory in psychology and psychoanalysis that divides the psyche into three distinct parts (id, ego, and superego), each with its own roles and dynamics.

Freud

The founder of psychoanalysis, a discipline concerning the study of unconscious motivations and conflicts.

Neurotic Personality

A personality type characterized by chronic anxiety, emotional instability, and a tendency towards internalized psychological distress.

Psychoanalytic Theory

A set of psychological and psychotherapeutic theories and techniques, which primarily focus on unconscious motivations and conflicts.