The Primary Basis of Accounting for Inventories Is Cost

question 81

Multiple Choice

The primary basis of accounting for inventories is cost. A departure from the cost basis of pricing inventory is required where there is evidence that when the goods are sold in the ordinary course of business, their

• A) selling price will be less than their replacement cost.
• B) replacement cost will be more than their net realizable value.
• C) future utility will be less than their cost.
• D) cost will be less than their replacement cost.

---

Definitions:

Allison WT

Refers to a series of automatic transmissions designed by Allison Transmission, tailored for a wide range of commercial vehicle applications.

Mercedes Benz AGS

An Automated Gear Shift system developed by Mercedes Benz, providing automated transmission shifting for enhanced driving comfort and efficiency.

Rail-select

A part of the gear selection mechanism in manual transmissions, allowing the driver to choose between different gear rails for engaging specific gears.

Gear-select Ball Screws

A component in some vehicle gearboxes that uses a rotary motion to move gears into place smoothly and precisely.