Inventory That Originally Cost $10,000 Was Written Down to Its

question 3

Multiple Choice

Inventory that originally cost $10,000 was written down to its net realizable value of $8,500 at the end of 2014.At the end of 2015, the net realizable value is determined to be $10,500.At what amount should the inventory be reported on the December 31, 2015 statement of financial position?

• A)$10,500
• B)$10,000
• C)$9,500
• D)$8,500

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Definitions:

Annual Returns

The percentage change in the value of an investment over a one-year period.

Risk Premium

The extra return expected by an investor for holding a risky asset, compared to a risk-free asset.

Corporate Bonds

Debt securities issued by corporations to finance their operations, expansion, or other spending needs, paying fixed or variable interest rates to investors.

Treasury Bills

Treasury Bills are short-term government securities with maturity periods of one year or less, often used by investors as a low-risk investment option.