Which of the Following Statements Is Correct

question 7

Multiple Choice

Which of the following statements is correct?

• A) Inventories should be shown at the lower of cost and net realizable value
• B) Inventories should be shown at net realizable value
• C) Inventories should be shown at cost
• D) Inventories should be shown at the higher of cost and net realizable value

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Definitions:

Margin

The difference between the selling price of a good or service and the cost of producing it, often expressed as a percentage of the selling price.

Return on Investment

A measure of the profitability of an investment, calculated as a percentage of the return relative to the investment's cost.

Investment Opportunity

A potential financial venture or asset purchase that could yield returns in the future.

ROI

Return on Investment, a metric used to evaluate the efficiency of an investment or compare the efficiency of several different investments.