Which of These Would Not Cause the Net Realizable Value

question 28

Multiple Choice

Which of these would not cause the net realizable value of inventory to be below its cost?

• A) a rise in the selling price
• B) physical deterioration
• C) a decision to sell at a loss
• D) All of the above would cause the net realizable value of inventory to be below its cost.

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Definitions:

Ending Balance

The amount of money in an account at the end of a financial period, after all transactions have been accounted for.

Plan Assets

The resources set aside to pay employee benefits under a pension or other post-employment benefit plan.

Fair Value

Rephrased: An accounting concept referring to the estimated price at which an asset could be bought or sold in a current transaction between willing parties.

Expected Pension Benefits

Expected pension benefits represent the future payments an employee has earned under a pension plan, based on factors like years of service and salary history.