When Inventory Declines in Value Below Original (Historical) Cost What

question 9

Multiple Choice

When inventory declines in value below original (historical) cost what is the maximum amount that the inventory can be valued at?

• A) Sales price
• B) Net realizable value
• C) Historical cost
• D) Sales price reduced by estimated costs to sell

---

Definitions:

Interact

To interact is to act in such a way that affects or influences another entity or person, suggesting a reciprocal or dynamic exchange.

Scientific Psychology

A branch of psychology that applies scientific methods to study and understand human thought, behavior, and emotion.

Folk Psychology

The informal, common-sense understanding and explanation of human behavior and mental processes, often contrasted with scientific psychology.

Real

Existing or occurring as a fact; actual rather than imaginary, ideal, or fictitious.