Recording Inventory at Net Realizable Value Is Permitted, Even If

question 9

Multiple Choice

Recording inventory at net realizable value is permitted, even if it is above cost, when there are no significant costs of disposal involved and

• A) the ending inventory is determined by a physical inventory count.
• B) a normal profit is not anticipated.
• C) there is a controlled market with a quoted price applicable to all quantities.
• D) the internal revenue service is assured that the practice is not used only to distort reported net income.

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Definitions:

Coal

A fossil fuel formed from the remains of plants that lived millions of years ago, used primarily for generating electricity and as a fuel source.

Remnants

Traces or remains of something that once existed.

Fire

A rapid oxidation process, which is a chemical reaction resulting in the release of heat and light.

Hominins

Refers to the group that includes modern humans, extinct human species, and all our immediate ancestors.