Martha Company Had 21,000 Units of Ending Inventory That Were

question 35

Multiple Choice

Martha Company had 21,000 units of ending inventory that were recorded at the cost of $7.00 per unit using the FIFO method.The current replacement cost is $4.25 per unit.Which of the following amounts would be reported as ending Merchandise Inventory on the balance sheet using the lower-of-cost-or-market rule?

• A) $147,000
• B) $236,250
• C) $168,000
• D) $89,250

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Definitions:

Lewin

Kurt Lewin, a German-American psychologist recognized for his field theory in social science and contributions to social psychology, group dynamics, and action research.

Projection

A psychological defense mechanism where individuals attribute their own unacceptable thoughts, feelings, and motives to another person.

Identification

Identification is the process or act of recognizing and accepting or affiliating oneself with particular characteristics, groups, or beliefs.

Stockholm Syndrome

A psychological response wherein a captive begins to identify closely with their captors, as well as with their agenda and demands.