If a Company Is Using the Lower-Of-Cost-Or-Market Rule and a Write-Down

question 7

Multiple Choice

If a company is using the lower-of-cost-or-market rule and a write-down is required,how will that write-down affect the elements of the company's financial statements?

• A)Net income will increase.
• B)Gross margin will decrease.
• C)Total assets will decrease.
• D)Gross margin and total assets will both decrease.

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