If the Replacement Cost of Inventory Is Less Than Its

question 135

Multiple Choice

If the replacement cost of inventory is less than its historical cost, the company will write down the inventory by:

• A)debiting Cost of Goods Sold and crediting Inventory.
• B)debiting Inventory and crediting Cost of Goods Sold.
• C)making a note in the financial statements only.
• D)debit Inventory for replacement cost, credit Inventory for historical cost.

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Definitions:

Stress Research

The study of how individuals respond physically, mentally, and emotionally to pressure, tension, and other external stimuli perceived as challenging.

Desired Goal

An objective, outcome, or state that a person or organization actively seeks to achieve or accomplish.

Health Psychology

A field of psychology that focuses on how psychological, behavioral, and cultural factors contribute to physical health and illness.

Prevention

Actions or measures taken to stop something undesirable, such as disease or accidents, from happening.