Your Company Has 100 Units in Inventory,purchased at $16 Per

question 212

Multiple Choice

Your company has 100 units in inventory,purchased at $16 per unit.These units have a current market value of $14.The entry to write-down the inventory will include a:

• A) credit to Cost of Goods Sold for $200.
• B) debit to Cost of Goods Sold for $1,400.
• C) credit to Inventory for $200.
• D) debit to Inventory for $1,400.

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Definitions:

Percentage of Sales

An approach used to forecast the future financials of a company based on its current sales data and growth assumptions, commonly used in financial modeling.

Dividend Policy

A company's stance on distributing profits back to its shareholders either in the form of dividends or stock repurchase.

Full Capacity

The utmost production capacity a firm can maintain over a certain period under typical situations.

Financial Planning

The process of setting financial goals, policies, procedures, and programs to guide the acquisition, use, and management of financial resources over time.