Which of the Following Statements Is INCORRECT Regarding the Overriding

question 161

Multiple Choice

Which of the following statements is INCORRECT regarding the overriding objectives underlying inventory standards?

• A) Report an inventory cost on the statement of financial position that is representative of the inventory's recent cost.
• B) Choose an approach that corresponds as closely as possible to the physical flow of goods.
• C) Use the same method for all inventory assets that have similar economic characteristics.
• D) It is permissible under ASPE to use any inventory method, including LIFO.

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Definitions:

Import Quotas

Restrictions set by a government on the quantity of a specific good that can be imported into a country.

Net Exports

The value of a country's total exports minus the value of its total imports, which is a component of a country's GDP.

Import Restrictions

Measures imposed by a government to control the quantity of goods coming into a country, often to protect domestic industries.

Trade Deficit

An excess of imports over exports.