When Applying Lower of Cost or Net Realizable Value Under

question 127

Multiple Choice

When applying lower of cost or net realizable value under the FIFO, average cost, or specific identification method, market value

• A) is defined as the selling price.
• B) is defined as the net realizable value.
• C) should not exceed the net realizable value less an allowance for a normal profit margin.
• D) should not exceed the net realizable value plus an allowance for a normal profit margin.

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