Transit Time Via Water Transportation Is the Longest of the Four

question 6

Multiple Choice

Transit time via water transportation is the longest of the four primary modes commodities.This modal service disadvantage has to be traded-off against the low-cost to the shipper for the transport of commodities.This tradeoff usually makes water transport attractive for which commodities?

• A) automobiles and construction machinery
• B) large, bulky and oversized shipments
• C) basic raw materials
• D) inventory items

---

Definitions:

Net Realizable Value

The estimated selling price in the ordinary course of business minus any costs necessary to make the sale.

LIFO

Last In, First Out, an inventory valuation method where the last items added to inventory are assumed to be the first ones removed, affecting cost of goods sold and inventory value.

Lower-Of-Cost-Or-Market

An accounting principle stating that inventory should be recorded at the lower of its historical cost or its current market price.

LIFO

Last In, First Out, a stock valuation approach that accounts for the most newly manufactured goods as being sold before all others.