Although IFRS Require the Use of the Lower of Cost

question 1

Multiple Choice

Although IFRS require the use of the lower of cost or market method to value inventory, some differences from GAAP still exist.Which of the following is not one of the differences?

• A)Market is defined only as net realizable value in IFRS.
• B)When write-downs occur, IFRS do not specify how the loss must be categorized in the income statement.
• C)IFRS allow the reversal of a previous write-down.
• D)IFRS define market only as replacement cost.

---

Definitions:

Focuses Light

The process of adjusting the path of light rays to converge at a point or to spread out from a point.

Retina

The light-sensitive layer of tissue at the back of the inner eye, which includes rods and cones that process visual images and send them to the brain.

Cornea

The transparent front part of the eye that covers the iris, pupil, and anterior chamber, responsible for focusing most of the light that enters the eye.

Purity

The condition or quality of being free from contamination, pollutants, or immoral behavior; often associated with cleanliness or moral wholesomeness.