The Logic Behind the Lower-Of-Cost-And-Net-Realizable-Value Rule Is

question 97

Multiple Choice

The logic behind the lower-of-cost-and-net-realizable-value rule is:

• A) Inventory gradually becomes obsolete.
• B) Inventory that is unsalable should be written down to zero (or its scrap value).
• C) An asset is not worth more than it would cost the owner to replace it.
• D) An asset is not worth more than it would be sold at its net realizable value.

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Definitions:

Poor Performers

Employees or members of an organization who consistently fail to meet the established performance standards.

Good Performers

Employees who consistently achieve or exceed their work objectives and contribute positively to the organizational goals.

Valid Performance Measures

The evaluation metrics that accurately and reliably reflect the true performance of an individual or organization.

Performance-Based Pay

A compensation system where an employee's pay is directly related to their performance or achievement of specific targets.