Which of the Following Statements Is Incorrect Regarding the Lower-Of-Cost-Or-Net

question 22

Multiple Choice

Which of the following statements is incorrect regarding the lower-of-cost-or-net realizable value (LCNRV) ?

• A) Net realizable value (NRV) is the selling price less estimated costs to complete and estimated costs to make a sale.
• B) In most situations, companies price inventory on a total-inventory basis.
• C) One of two methods may be used to record the income effect of valuing inventory at net realizable value.
• D) Companies use an allowance account, the "Allowance to Reduce Inventory to Net Realizable Value."

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Definitions:

Learning Perspective

A psychological viewpoint that emphasizes the effects of experience on behavior, focusing on learning processes.

Cognitive Perspective

A psychological viewpoint that focuses on how people think, understand, and know about the world, emphasizing the importance of mental processes in understanding behavior.

Sociocultural Perspective

A psychological approach that emphasizes the influence of societal and cultural factors on individual behavior and mental processes.

Psychodynamic Perspective

A psychological approach that emphasizes the systematic study of the psychological forces that underlie human behavior, feelings, and emotions and how they might relate to early experience.