When Inventories Are Written Down Due to the Application of the Lower

question 13

Multiple Choice

When inventories are written down due to the application of the lower of cost or market (LCM) rule, the account that is usually increased is

• A) Accumulated Depreciation-Inventory
• B) Inventories
• C) Loss on Decline in Inventory Value
• D) Cost of Goods Sold

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Definitions:

National Economy

The economic activities and performance of a nation, encompassing its gross domestic product, employment rates, and the balance of imports and exports.

Uncontrolled Population Growth

This refers to the rapid increase in the number of individuals in a population, often due to lack of access to contraceptives, education on family planning, or policies limiting the number of children per family, leading to potential overpopulation issues.

Destruction of the Environment

Refers to the damage inflicted on natural ecosystems by human activities, leading to loss of biodiversity, pollution, and climate change.

Nuclear War

A conflict where nuclear weapons are used by the opposing sides, causing massive destruction.