When Applying the LCM Using the Direct Method the Following

question 63

Multiple Choice

When applying the LCM using the direct method the following is true:

• A)The inventory account remains at its original value
• B)A contra account to inventory is used
• C)COGS rises when ending inventory is reduced to market value
• D)LCM can only be applied to individual items.

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Definitions:

Direct Index Approach

A method used in finance to directly compare the performance of various investments or securities to a specific market index.

Results Based-Format

an approach focusing on outcomes and results in the context of performance assessments or project management.

Rater Bias

A tendency for evaluators to make subjective and potentially inaccurate assessments due to personal prejudices or preferences.

Graphics Rating Scale

A method used in performance appraisal that evaluates employees' performance on a continuum, often illustrated by a line or bar.