A Company Normally Sells Its Product for $20 Per Unit

question 119

Multiple Choice

A company normally sells its product for $20 per unit. However, the selling price has fallen to $15 per unit. This company's current inventory consists of 200 units purchased at $16 per unit. Replacement cost has now fallen to $13 per unit. What is the amount of the lower cost of market adjustment the company must make as a result of this decline in value?

• A) $400.
• B) $600.
• C) $800.
• D) $1,400.
• E) $1,000.

---

Definitions:

Cognitive Constructs

Mental models or concepts that individuals use to organize their thoughts and understand the world around them.

Freudian Theory

A set of psychoanalytic theories developed by Sigmund Freud that emphasizes unconscious motivations and conflicts, particularly those stemming from childhood.

Psychotherapy

A therapeutic treatment involving psychological methods, typically involving dialogues between a therapist and a client, to address mental health issues or emotional disorders.

Self-awareness

An understanding of one's personal attributes, feelings, intentions, and aspirations.