If Year-End Inventory Is Reduced from Cost to a Lower

question 76

Multiple Choice

If year-end inventory is reduced from cost to a lower net realizable value,which of the following accurately depicts the results?

• A) Year-end inventory is reduced and cost of goods sold is reduced by the same amount.
• B) Cost of goods sold is reduced and beginning inventory of the next period is reduced by the same amount.
• C) The capital account balance is increased and beginning inventory of the next period is reduced by the same amount.
• D) Cost of goods sold is increased and beginning inventory of the next period is decreased by the same amount.

---

Definitions:

Two-Dimensional Images

Visual representations of objects, scenes, or ideas on a flat surface that have height and width but no depth.

X-Rays

A form of electromagnetic radiation used in medical imaging to view the inside of the body without making an incision.

Psychophysiological Tests

Tests in which instruments are attached to the periphery of the body to record changes due to activity in the nervous system.

Computerized Tomography

An imaging technique that uses computer-processed combinations of multiple X-ray measurements taken from different angles to produce cross-sectional images of specific areas of a scanned object.