Generally Accepted Accounting Principles (GAAP)require That the Inventory Be Reported

question 60

Multiple Choice

Generally accepted accounting principles (GAAP) require that the inventory be reported at:

• A) market value.
• B) historical cost.
• C) lower of cost or market.
• D) retail value.

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Definitions:

AASB 16

The Australian Accounting Standard Board 16 specifies the principles for the recognition, measurement, presentation, and disclosure of leases, both for lessees and lessors.

IFRS 16

An International Financial Reporting Standard that specifies the principles for recognizing, measuring, presenting, and disclosing leases, primarily affecting lessees by requiring most leases to be reported on the balance sheet.

Manufacturer/Dealer Lessors

Entities that lease out assets they manufacture or sell, as part of their main business operations, to earn income and stimulate demand for their products.

Selling Profit

The financial gain achieved from selling goods or services, calculated as sales revenue minus the cost of goods sold and associated selling expenses.