When the Lower of Cost or Market (LCM) Rule Requires

question 97

Multiple Choice

When the lower of cost or market (LCM) rule requires an inventory adjustment:

• A) the adjustment usually, but not always, reduces the book value of inventory.
• B) the write-down is usually reported as a part of cost of goods sold.
• C) the inventory adjustment is recorded in a contra-revenue account called sales allowances.
• D) the write-down does not affect any of the financial statements.

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Definitions:

Patricia Hill Collins

A distinguished American sociologist known for her research and theory on race, class, gender, sexuality, and nationality, particularly in her contribution to feminist thought and black feminist theory.

Michelle Obama

The former First Lady of the United States, advocate for education, health, and poverty awareness, and wife of the 44th President, Barack Obama.

Gender And Race

Intersecting social constructs that influence the experiences, opportunities, and challenges faced by individuals, highlighting how gender and race jointly shape societal roles and perceptions.

Black Women

Refers to women of African descent or who identify as part of the African diaspora, emphasizing their unique cultural, historical, and socio-political experiences.