The Following Inventory Information Was Taken from the Records of GlobeKom

question 12

Multiple Choice

The following inventory information was taken from the records of GlobeKom Ltd.: $\begin{array}{lr}\text { Historical cost } & \$ 12,000 \\\text { Replacement cost } & \$ 9,000 \\\text { Expected selling price } & \$ 10,000 \\\text { Expected selling cost } & \$ 500 \\\text { Normal profit margin } & 10 \% \text { of selling price }\end{array}$
-Under U.S.GAAP, what should the balance sheet report for Inventory?

• A)$9,000
• B)$8,500
• C)$9,500
• D)$10,000

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Definitions:

Encoding

The method through which data is converted into a form that can be retained in memory.

Recall

The process of retrieving information from memory that has been previously encoded and stored.

State-dependent Memory

The phenomenon where information learned in a particular state of mind (e.g., emotional or physiological state) is more easily recalled when in the same state.

Prefrontal Cortex

The part of the brain located at the front of the frontal lobes, involved in complex behaviors including planning, decision making, and moderating social behavior.